Bengaluru – The Bangalore Wholesale Cloth Merchant’s Association has raised serious concerns over the continued harassment of GST-registered small and local traders across Karnataka by municipal bodies demanding separate trade licenses. The Association, in a formal letter addressed to Hon’ble Chief Minister Sri Siddaramaiah, has called for urgent intervention to protect the interests of small business owners who are facing repeated notices, penalties, and threats from local officials.
Prakash Pirgal, President of the Association, stated that despite full compliance with GST norms and regular tax payments, small traders are being forced to obtain additional trade licenses from local municipal corporations. This, he said, is leading to redundant documentation, duplicate fee payments, and unnecessary legal burdens on small enterprises, particularly in urban and semi-urban areas.
Key Concerns Highlighted:
GST registration already captures and shares business information with both State and Central tax departments.
Despite this integration, municipal bodies are insisting on a separate licensing system, creating a disjointed and duplicative compliance burden.
The sudden issuance of notices and penalties has created confusion and fear among small traders and shopkeepers.
Many small traders, lacking the legal and financial resources to navigate these challenges, are feeling harassed and vulnerable.
The move runs contrary to the government’s stated goals of ‘Ease of Doing Business’, ‘Digital Karnataka’, and support for small and micro enterprises.
Demands Submitted to the State Government:
1. Issue a clear Government Order or Circular exempting GST-registered traders from mandatory trade license requirements by municipal bodies.
2. Work towards implementing a ‘One Nation, One Registration’ system where GST registration alone is considered valid for operating a business.
3. Ensure that no penalties or harassment are imposed on compliant small businesses.
4. Establish a dedicated grievance redressal mechanism to assist small traders facing difficulties with municipal enforcement.
“Small traders form the backbone of Karnataka’s local economy and employment landscape. The current approach by municipal bodies is punitive and contrary to progressive governance. We appeal to the Chief Minister to intervene and provide immediate relief,” said Mr. Pirgal in his appeal.
The Association has expressed hope that the government will take swift action to streamline compliance requirements and ensure a more business-friendly environment for lakhs of traders across the state.
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