Siddaramaiah waives old GST dues of small traders; July 24 protest called off

Mangalore Today News Network

Bengaluru, July 24, 2025: Amid the confusion over small-scale traders in the state receiving GST notices from the Commercial Taxes Department, Chief Minister Siddaramaiah on Wednesday said that old tax dues of the small traders who got the notices would be waived.

The decision comes as a relief to around 9,000 traders across the state who had received nearly 18,000 GST notices in the last two to three years.

The waiver came after a meeting chaired by Siddaramaiah at his official residence. It was attended by officials from the Commercial Tax Department and leaders of trade bodies.

Following the CM’s announcement, trade groups have decided to cancel the protest they planned on Thursday.

"Our demand has been met. Many of us sell a variety of goods. While a few are exempted from GST, many others have 3 per cent to 40 per cent tax. But that was not considered while issuing the notice. However, the CM has assured that the notices will not be pursued further," said Abhilash Shetty, Karnataka State Association of Bakeries, Condiments and Small Enterprises.

A statement from the Chief Minister’s Office said trade representatives complained that many GST notices included not just business transactions but also personal money transfers and loan disbursals done through the UPI, which caused confusion. Even though some GST notices were legally right, traders sought the government’s help, especially to allow payment of taxes directly without middlemen, creating a special helpline and running programmes to explain GST rules better.

At a press conference after the meeting, Siddaramaiah said GST notices were sent only to traders whose UPI transactions exceeded a total value of Rs 40 lakh in the last two to three years. The main goal was to encourage these traders to register for GST. He also pointed out that essential items like milk, vegetables, meat, fruits, bread and tender coconuts do not come under the ambit of GST.

"Even though notices were sent to traders selling these exempt items, no tax will be taken from them. Also, the government will not try to collect old tax dues from the last two to three years," he said.

Siddaramaiah highlighted that Karnataka leads in digital payments, with 40 per cent of all transactions happening through UPI — higher than the national average of 30 per cent. He said this is a big success for the formal economy. He also warned that stopping UPI payments would hurt trade and cause big losses to traders.

"The traders are now ready to register, and there is no more confusion," the chief minister said. "The government will support legal trade and timely tax payments. We are on the side of small traders and will not trouble them."

He added that waiving old tax dues depends on traders registering under the GST law. "Traders who deal only in exempt goods don’t have to register. If their main goods are exempt, tax officials won’t pursue them," he said.

Finally, the government plans to hold workshops and seminars across Karnataka with tax officials and trade leaders to educate traders and make GST compliance easier.

The traders have agreed to register themselves in the GST portal to ensure there is no more confusion in the future.

“We will also hold awareness drives and get our traders to register,” Shetty added.