Centre plans GST nudge for small traders

India's indirect tax administration plans a gentle approach to pull more retail traders and vendors into the goods and services tax (GST) net, unlike Karnataka and Tamil Nadu's direct efforts that resulted in a backlash, two officials said.

- Gireesh Chandra Prasad

Traders and vendors with annual sales above ₹40 lakh are required to be registered under the GST umbrella, but several don't. Vendors in Karnataka launched protests after state tax authorities issued notices based on their unified payments interface (UPI) transactions. Some of those who received the notices were vendors of vegetables, which are exempt from GST.

Central authorities will employ smoother ways to widen the tax base among the politically active and unionised trading community.

The Central government has sought information from states about their drive to leverage UPI transaction data for enforcing GST compliance and is expected to give an update to Parliament in the current session, the two officials said.