GST Notice: Shankargowda, a vegetable vendor in Karnataka for four years, has received a GST notice of Rs 29 lakh for accepting UPI payments. Shankargowda had made UPI transactions worth Rs 1.63 crore in the last four years, on the basis of which the GST department has sent this notice.
GST Notice: A small vegetable vendor in Haveri, Karnataka has received a notice of Rs 29 lakh. The vegetable vendor was shocked after seeing the notice. This vendor named Shankargowda made UPI transactions worth Rs 1.63 crore in the last four years, on the basis of which the GST department has sent this notice. Repeated digital transactions raised suspicion among GST officers, due to which he was given this notice. After these incidents, small shopkeepers in cities like Bengaluru and Mysore are leaving UPI and insisting on cash transactions due to fear.
Let us tell you that Shankargowda of Haveri has been running a vegetable shop near the Municipal High School for the last four years. Most of his income comes from UPI and digital wallet. Shankargowda says, I buy and sell fresh vegetables from farmers, which are exempt from GST. I file income tax return every year. How can I pay such a huge tax?
Shopkeepers shying away from UPI payments
According to the rules, if a seller buys vegetables directly from farmers and sells them without processing, then GST is not applicable on such fresh and cold vegetables. On the other hand, if the vegetables are branded or packed, then 5% GST is applicable on them. Currently, after Shankargowda’s case in Karnataka, many small traders like him have stopped accepting UPI payments. Now they are only accepting cash.
Fear of notice increases on small shopkeepers
Thousands of small shopkeepers in Karnataka are getting GST notices. The reason is that transactions through UPI are now on the radar of the GST department. If the annual turnover is more than Rs 40 lakh (for those selling goods) or Rs 20 lakh (for those providing services), then GST registration is necessary. Many traders are unknowingly crossing this limit, due to which they are getting notices. It was clarified by the Karnataka GST department that they are keeping a close watch on traders accepting digital payments. On July 12, it was said that notices will be sent to those traders whose total turnover exceeds the GST registered limit.
Will raise the issue before the Centre – CM
Karnataka CM Siddaramaiah has said that he will raise this issue before the Central Government and GST Council. He assured the traders that he will not let the small traders face trouble.
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