GST Crackdown? Karnataka Businesses Say Notices Are Unfair Pressure

Many businesses in Karnataka have recently received GST notices from state tax authorities. Tax experts say that these notices are related to old tax filings, some from four to six years ago, which were filed during the early years after GST was introduced in 2017.

According to chartered accountants, several of these notices are about small mistakes or minor differences in tax records. Such issues are quite common in normal business activities. Authorities may also be sending these notices now because they are trying to increase tax collections before the financial year ends.

When a business receives a notice, it is usually called for a hearing with the tax officer. During this meeting, the officer reviews the tax records and addresses any discrepancies identified in the submissions.

Some of the common issues mentioned in the notices include stock mismatches, mistakes in selecting the appropriate filing category, and missing compliance under the Reverse Charge Mechanism (RCM). In particular, some businesses in the hospitality sector have received notices related to rental transactions that fall under RCM rules.

Tax professionals have also pointed out a problem that some notices were sent offline instead of being uploaded on the official GST portal, which is usually the standard procedure.

In many cases, these matters were settled through discussions with the tax officer during the hearing itself rather than going through a long legal process. Several business owners prefer to resolve the issue at the hearing stage instead of taking the matter to court.