GST notices shock small bakery owners

Thousands of small bakery, tea, and condiments shop owners across Karnataka have been left stunned after receiving GST notices from the state’s Commercial Tax Department. The department reviewed digital transactions from the past four years and concluded that several businesses had turnover ranging from lakhs to crores, triggering tax liabilities.

In today’s digital economy, most transactions at such shops are made through platforms like Google Pay, PhonePe, and Paytm—even for small items like tea, snacks, or cigarettes. Based on this digital trail, the department issued notices demanding backdated tax payments.

Many shopkeepers, who operate with limited margins, are now panicking over how to pay taxes that reportedly exceed their annual savings. “Even after a year of hard work, we barely save ₹2–3 lakh. Now, we’re asked to pay taxes in lakhs—how is that fair?” questioned distressed owners. According to Ravi Shetty, President of the Labour Council Union, over 60,000 such small establishments exist across the state, and hundreds have approached him after receiving the notices. He criticized the government’s move, calling it a betrayal of the poor and small entrepreneurs who relied on state-backed schemes to start their businesses.

The union ’as warned of mass protests involving over 1 lakh people unless the government rolls back the notices. Shopkeepers have expressed fears of financial ruin, saying they might lose their only source of livelihood. All eyes are now on the government’s response to the growing outrage from the state’s small business community.