Fri Apr 18 20:50:00 UTC 2025: ## Government Denies Plans to Impose GST on UPI Transactions Over ₹2,000

**NEW DELHI** – The Indian government has categorically denied reports suggesting the introduction of Goods and Services Tax (GST) on Unified Payments Interface (UPI) transactions exceeding ₹2,000. In a statement released on April 18th, the Ministry of Finance labeled the reports as “completely false, misleading, and without any basis.”

Earlier reports had speculated that a potential 18% GST could be levied on high-value UPI transactions to improve tax compliance and formalize more digital transactions. These reports claimed the proposal was under consideration.

The finance ministry clarified that GST is only applicable to charges associated with UPI payments, such as the Merchant Discount Rate (MDR). However, since the MDR on Person-to-Merchant (P2M) UPI transactions was removed in January 2020, no GST is currently levied.

The government reaffirmed its commitment to promoting digital payments via UPI, citing a government incentive scheme operational since FY 2021-22 to support its growth, particularly for small merchants. The success of this scheme is evidenced by the exponential growth of UPI transactions, from ₹21.3 lakh crore in FY 2019-20 to ₹260.56 lakh crore by March 2025. This growth underscores India’s leading position in global real-time digital payments, according to the ACI Worldwide Report 2024.

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