Bakeries and condiment shops across Karnataka suspended the sale of tea, coffee, and milk on Wednesday in a symbolic protest against Goods and Services Tax (GST) notices issued by the Commercial Tax Department to small-scale vendors. Traders wore black badges and halted beverage services for the day, accusing the department of targeting them unfairly through a digital transaction-based crackdown.
Labour activist Ravi Shetty, speaking at a protest site, said, “Today we are wearing black bands on our arms. No bakery is selling milk. Only black tea will be available as a mark of protest.” While normal business continued otherwise, beverage counters across thousands of outlets served only black tea or black coffee to register their dissent. The unexpected interruption highlighted growing vendor annoyance over recent GST notifications connected to digital payment information.
Data gathered from UPI and other digital payment platforms for the fiscal years 2021–2022 through 2024–2025 is the source of the enforcement campaign. Regardless of whether the payments were made in cash or through UPI, traders whose digital transactions exceeded the GST exemption thresholds—Rs 20 lakh for services and Rs 40 lakh for goods—were sent notices by the Commercial Tax Department.
In response to the growing panic, many vendors have now shifted to cash-only sales and are displaying “No UPI” signs to avoid further scrutiny. Several market stalls, bakeries, tea vendors, and other small businesses in Bengaluru and other districts have taken similar steps. The backlash has prompted Chief Minister Siddaramaiah to convene a high-level meeting at his residence at 3 PM today, inviting representatives of small traders to address their concerns.
Additionally, on July 25, 2025, trade associations have called for a statewide bandh to demand the immediate removal of what they say are excessive and arbitrary tax assessments.
One such case involves Shankargouda Hadimani, a vegetable vendor from Haveri, who received a GST demand notice of Rs 29 lakh. According to officials, his digital receipts over the last four years totaled Rs 1.63 crore. Hadimani insists he only sells fresh vegetables, which are GST-exempt, and has always filed his taxes. “I don’t know how to arrange such a huge amount. This is completely unfair,” he said.
Traders have warned of intensified protests if the government fails to act promptly and withdraw the GST notices targeting their digital transactions.
Also Read: Gujarat sees 145 pc rise in GST taxpayers in 8 years
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