{"id":1297891,"date":"2025-07-19T09:53:23","date_gmt":"2025-07-19T04:23:23","guid":{"rendered":"https:\/\/trak.in\/stories\/?p=1297891"},"modified":"2025-08-07T11:59:28","modified_gmt":"2025-08-07T06:29:28","slug":"after-karnataka-it-dept-targets-4-more-states-for-upi-based-gst-taxation","status":"publish","type":"post","link":"https:\/\/trak.in\/stories\/after-karnataka-it-dept-targets-4-more-states-for-upi-based-gst-taxation\/","title":{"rendered":"After Karnataka, IT Dept Targets 4 More States For UPI Based GST Taxation"},"content":{"rendered":"\n<p>Following Karnataka\u2019s request for UPI merchant turnover data, four more states\u2014Andhra Pradesh, Uttar Pradesh, Tamil Nadu, and Gujarat\u2014have asked UPI apps and payment aggregators to share annual merchant transactions. This effort aims to identify merchants with turnover above Rs 40 lakh, the threshold for mandatory GST registration.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"1000\" height=\"465\" src=\"https:\/\/trak.in\/stories\/wp-content\/uploads\/2025\/07\/Untitled-design-10-1-1.jpg\" alt=\"After Karnataka, IT Dept Targets 4 More States For UPI Based GST Taxation\" class=\"wp-image-1297897\" srcset=\"https:\/\/trak.in\/stories\/wp-content\/uploads\/2025\/07\/Untitled-design-10-1-1.jpg 1000w, https:\/\/trak.in\/stories\/wp-content\/uploads\/2025\/07\/Untitled-design-10-1-1-300x140.jpg 300w, https:\/\/trak.in\/stories\/wp-content\/uploads\/2025\/07\/Untitled-design-10-1-1-768x357.jpg 768w\" sizes=\"auto, (max-width: 1000px) 100vw, 1000px\" \/><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Fear of GST Notices Triggers Backlash<\/strong><\/h3>\n\n\n\n<p>Traders\u2019 bodies are advising members to return to cash-based payments. In Karnataka, small vendors plan a state-wide shutdown on July 25 if notices are not withdrawn. Some have already stopped accepting UPI altogether, fearing heavy tax demands.<\/p>\n\n\n\n<p>A vendor in Mysuru shared that his revenue data triggered a Rs 30 lakh notice, causing him to shut UPI operations and lose business. Similar stories are surfacing from across Bengaluru.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Digital Payment Boom Faces Roadblock<\/strong><\/h3>\n\n\n\n<p>UPI is India\u2019s most widely used digital payment method, processing over 18 billion transactions monthly. However, merchant concerns could slow down this momentum. Merchant payments form 63 percent of all UPI transactions, making the issue more alarming for payment firms like PhonePe, Paytm, and BharatPe.<\/p>\n\n\n\n<p>A UPI app executive warned that if more states issue notices, merchants nationwide may shift to cash despite strong customer preference for UPI.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Turnover vs Tax Liability: A Confusing Debate<\/strong><\/h3>\n\n\n\n<p>Bankers argue that using UPI transaction totals as a proxy for GST liability is misleading. Not all items sold via UPI attract GST\u2014many are exempt, like food staples. Traders, often unaware of this nuance, perceive the notices as penalties rather than compliance reminders.<\/p>\n\n\n\n<p>The Karnataka tax department clarified that notices aim to encourage registration, not immediate tax collection. Still, confusion remains.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>One Shop, Many QRs: Loopholes Surface<\/strong><\/h3>\n\n\n\n<p>In response, merchants may use multiple QR codes linked to personal accounts to dodge scrutiny. Authorities are monitoring this closely, especially after past incidents where individual vendors received large payments via multiple accounts.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>What\u2019s at Stake?<\/strong><\/h3>\n\n\n\n<p>Experts warn this aggressive approach risks undermining trust in digital payments. While ensuring tax compliance is important, blanket enforcement may drive informal businesses back into the shadows\u2014hurting both innovation and revenue.<\/p>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Following Karnataka\u2019s request for UPI merchant turnover data, four more states\u2014Andhra Pradesh, Uttar Pradesh, Tamil Nadu, and Gujarat\u2014have asked UPI apps and payment aggregators to share annual merchant transactions. This effort aims to identify merchants with turnover above Rs 40 lakh, the threshold for mandatory GST registration. Fear of GST Notices Triggers Backlash Traders\u2019 bodies [&hellip;]<\/p>\n","protected":false},"author":30,"featured_media":1297897,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[41],"class_list":["post-1297891","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-upi"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.9 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>After Karnataka, IT Dept Targets 4 More States For UPI Based GST Taxation - Trak.in - Indian Business of Tech, Mobile &amp; Startups<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/trak.in\/stories\/after-karnataka-it-dept-targets-4-more-states-for-upi-based-gst-taxation\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"After Karnataka, IT Dept Targets 4 More States For UPI Based GST Taxation - Trak.in - Indian Business of Tech, Mobile &amp; Startups\" \/>\n<meta property=\"og:description\" content=\"Following Karnataka\u2019s request for UPI merchant turnover data, four more states\u2014Andhra Pradesh, Uttar Pradesh, Tamil Nadu, and Gujarat\u2014have asked UPI apps and payment aggregators to share annual merchant transactions. 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