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India May Cut 18% GST on UPI Payments

24 Sep

Summary

India's government is reviewing the 18% GST on UPI transactions.
A government source expressed hope for a review by the GST Council.
The tax applies to merchant discount rates for UPI payments.

The Indian government is hopeful that the Goods and Services Tax (GST) Council will review the current 18% tax levied on merchant discount rates for transactions conducted via the Unified Payments Interface (UPI). This sentiment was conveyed by a government source on Thursday. The potential review signals a possible shift in policy concerning digital transaction costs.

The focus of the review is specifically on the 18% tax applied to merchant discount rates, which are associated with UPI transactions. This development could lead to a reduction in the tax burden for businesses and merchants utilizing the increasingly popular UPI payment system, thereby potentially encouraging further digital adoption across the country.

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