BENGALURU: Following reports of notices issued to small traders by the Commercial Tax Department, the state government clarified on Friday that the action was based on data collected from Unified Payments Interface (UPI) service providers to ensure compliance with Goods and Services Tax (GST) laws.
Under the GST Act, in force since July 1, 2017, suppliers with an annual turnover exceeding Rs 40 lakh (for goods) or Rs 20 lakh (for services) are required to register for GST. This turnover includes both taxable and exempt goods and services, although tax is applicable only on taxable items.
The department said while essential items like bread are exempt from GST, packaged snacks attract a 5% tax. It said UPI-based transaction data from 2021–22 to 2024–25 showed that many traders had received over Rs 40 lakh via UPI alone, excluding cash and other payment methods, indicating even higher total turnover. Based on this data, the department issued notices to traders. ENS