Karnataka bakeries suspend tea, coffee, milk sales in protest

Small traders across Karnataka stopped selling tea, coffee, and milk to protest GST notices based on UPI data. Vendors switched to cash-only sales, wearing black badges, demanding withdrawal of tax notices. Chief Minister Siddaramaiah has called for a small traders meeting today.

Bakeries and condiment stores across Karnataka stopped serving tea, coffee, and milk on Wednesday in a symbolic protest against tax notices issued to small-scale vendors by the Commercial Tax Department. Small traders wore black badges and suspended beverage sales for the day, accusing the department of unfairly targeting them.

Labour activist Ravi Shetty, speaking from one of the protest sites, 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.”

The protest largely affected beverage counters in bakeries and condiment shops, while all other commercial activity continued as usual. In some outlets, only black tea and black coffee were served to customers, signalling the traders’ dissent.

The agitation comes amid growing resentment from small vendors over the department’s recent GST notices. Traders have warned of intensified protests if the notices are not withdrawn.

In response to the unrest, Chief Minister Siddaramaiah has called a meeting at his residence at 3 pm today to discuss the issue with representatives of the small traders.

The sweeping enforcement drive has triggered panic among small vendors across the state, many of whom have now switched to “cash-only” operations.

The crackdown, based on data from UPI and other digital payment platforms between FY 2021–22 and FY 2024–25, has led to notices being issued to traders whose digital receipts alone crossed Rs 20 lakh (for services) or Rs 40 lakh (for goods).

Officials clarified that the mode of payment, UPI or cash, doesn’t matter, and total turnover, including cash sales, is what counts.

Caught off guard, many vendors in Bengaluru and beyond, including tea stalls, bakeries, and market shops, have put up “No UPI” signs, fearing tax liabilities running into lakhs or crores. Trader associations have called for a statewide bandh on July 25, 2025, protesting what they allege are excessive and arbitrary tax demands.

One such trader, Shankargouda Hadimani, a vegetable seller from Haveri, said he was shocked to receive a notice demanding Rs 29 lakh in GST after officials calculated his UPI transactions over four years at Rs 1.63 crore. Shankargouda, who only sells fresh vegetables, which are exempt from GST, said he files his taxes regularly and now doesn’t know how he can arrange such a huge sum.

Source : Dairynews7x7 July 23th 2025 India Today by Sagay Raj