Chief Minister Siddaramaiah will meet with trade bodies along with finance department secretaries and commercial tax officers to allay the fears of small traders and street vendors on complying with GST norms on Wednesday.

Over 16,000 businessmen, many of them uneducated vendors selling fruits, pan, cigarettes, vegetables, milk, and flowers or canteens, bars etc across the state have been slapped with tax demands for allegedly exceeding Rs 40 lakh in goods turnover or Rs 20 lakh in services for UPI payments since 2021.

Calling the move “unfair and insensitive,” FKCCI chairman MG Balakrishna said, “These are poor, struggling vendors. Most don’t even know what GST is. How can we expect them to understand taxable vs non-taxable income when they’ve never been informed? The government must educate them first-not ambush them with 18% tax.”

About 25 other representatives from other trade bodies too are expected to be present in Wednesday’s meeting. Balakrishna urged the state to consider a symbolic 1% levy instead of imposing the full GST retrospectively. Sources said the commercial tax department only acted after monitoring transactions for four years. Seven divisions in Bengaluru alone have been hit.

Tax department sources said if they have consistently made a turnover of more than 40 lakh UPI payments then imagine the volume of cash payments, surely it is bound to be higher.

Tax sources said this is not the full figure. There are about five service providers and this is the data from only two of them. Perhaps if we comprehensively take the data from all of them it could be higher. Officials said many vendors were unaware that pushcarts selling perishables like vegetables, fruits, milk, meat and flowers are tax-exempt-leading to a mistaken assumption that they are taxable.

Source: The New Indian Express