Bengaluru, July 19: The small traders and street vendors in Bengaluru have almost stopped receiving UPI payments and are now insisting on cash transactions, after the Commercial Tax department has issued notices to over 14000 traders, who have transacted over Rs 40 lakh per year through UPI payments.
In the first stage, the Commercial Tax officials have issued notices to over 5500 such traders and vendors, which include bakeries, petty shops, vegetable vendors and others, asking them to pay 18% GST over their transactions.
The traders are now hiding their scanners and are asking for only cash transactions on the lines of earlier systems. Rajappa, a vegetable vendor in Bannerughatta, whose transaction is said to be over Rs 60 lakh per year and has been asked to pay GST for the last three years said that he was unaware of such a huge transaction in his establishment.
"Everyday, we used to procure vegetables, which had to be purchased by paying full payment. Entire day, the customers paid through UPI and we accepted it. The whole transaction seems to have crossed Rs 60 lakh per year and they are asking us to pay the GST for the complete transaction amount.Our profit margin is not more than 10% and in that, we will have wastage in the form of rotten vegetables and fruits. At the most, we earn around Rs 50,000 to Rs 60,000 per month. Where can we bring 11 lakh per year to pay GST?'' he questioned.
Even the bakery owners are asking the same question. "We are procuring everything from the market and selling it with a small profit margin. For example, we get milk from KMF and our profit margin will be around Rs 2 per liter. Now, we have to pay GST for two transactions. One is when we procure it for Rs 38 per liter and another is when we sell it for Rs 40 per liter. We will be paying 18% GST for Rs 78, while our actual earning is only Rs 2,'' they claimed.
However, the Commercial Tax officials have identified the list of UPI accounts under single PAN number, which have transacted over Rs 40 lakh money. It has been calculated for the years 2021-22, 2022-23, 2023-24 and 2024-25 and the beneficiaries have been asked to give details of the nature of their business.
Commercial Tax Additional Commissioner Chandrashekhar Nayak said that there was no need for the traders to panic. "They can come to the Commercial Tax office and give details of their business and there is time for that. There will be some goods coming under the GST and some goods exempted from GST. If they give details, their problems would be solved,'' he said.
However, the damage has been done. Most of the small vendors, including petty shop owners, are avoiding any type of UPI transactions. Meanwhile, the customers are struggling to return to the old cash system, as most of them are used to UPI for even purchasing a cigarette or any daily needs.
