Why some shops are refusing UPI payments in Karnataka
What's the story
The Karnataka Commercial Tax Department's recent move to issue demand notices to traders over Goods and Services Tax (GST) evasion has created a stir. The action, which targets those with an annual turnover of over ₹40 lakh via Unified Payments Interface (UPI) transactions, has made small traders and shopkeepers hesitant about accepting digital payments. Some have even removed UPI QR code stickers from their establishments in Bengaluru after the crackdown.
Case details
Around 14,000 evasion cases identified
Karnataka's Commissioner of Commercial Taxes, Vipul Bansal, revealed that they have identified 14,000 evasion cases so far. "Notices are being issued to those with UPI receipts above ₹40 lakh," he said. The department has collected data from UPI service providers on payments received by traders up to the current fiscal year. Despite the crackdown, Bansal assured there is no need for panic as only notices have been sent for now.
Payment trends
Some merchants have removed QR codes
The UPI QR codes have become a popular payment method among shopkeepers for small-value transactions. However, some merchants have removed these codes and asked the customers to pay in cash. Bansal clarified that the UPI revolution was driven by consumers, not traders. "If one trader refuses UPI, another will accept it — because the demand comes from the customer," he said.
Response
Shopkeeper talks about the situation
Shopkeeper Sudhakar Sheenappa Shetty, who received a GST notice, said he was discussing with other shop owners to take up the matter with the government. "We continue to allow UPI payments. Customers want UPI. We will see how this can be worked out," he told Moneycontrol. Meanwhile, some social media users welcomed the government's move while others expressed concerns about potential inconveniences for consumers if this trend continues.