Overview

• Over 14,000 unregistered traders have received show-cause notices after the Commercial Taxes Department used UPI data to flag turnovers above ₹40 lakh for goods or ₹20 lakh for services.
• Numerous small vendors, including those selling GST-exempt fresh vegetables, have abandoned digital payments in favor of cash to avoid hefty retrospective tax claims.
• The state government has deployed a dedicated helpline and rolled out workshops under the statewide “Know GST” initiative to educate traders on registration thresholds and exemption rules.
• Chief Minister Siddaramaiah and Deputy CM Shivakumar have formally engaged the Union government and plan to seek withdrawal or adjustment of notices at the next GST Council meeting.
• Traders remain uncertain about exemption criteria and fear interest and penalties on past transactions as the drive to formalize micro-businesses collides with their limited compliance capacity.