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 social media reports claiming it plans to introduce a Goods and Services Tax (GST) on Unified Payments Interface (UPI) transactions exceeding ₹2,000. The Central Board of Indirect Taxes & Customs (CBIC) termed the reports as “completely false, misleading, and baseless.”
The CBIC clarified that no such proposal is currently under consideration. They emphasized that GST is levied on charges associated with transactions, such as the Merchant Discount Rate (MDR). However, since the MDR for Person-to-Merchant (P2M) UPI transactions was removed in January 2020, no GST is applicable. This was officially declared via a Gazette Notification on December 30, 2019.
The government highlighted its continued support for UPI, describing it as revolutionary for rural communities and actively promoting its use through incentive schemes since FY 2021-22. These schemes help cover transaction costs for merchants, encouraging wider adoption of digital payments.
Recent data from the National Payments Corporation of India (NPCI) reveals a remarkable surge in UPI transactions. March 2025 saw a record ₹24.77 lakh crore in transactions, a 12.7% increase from the previous month and a significant rise compared to the same period last year. This underscores India’s leading position in real-time digital payments globally, accounting for a staggering 49% of all global real-time transactions in 2023, according to the ACI Worldwide Report 2024. The government’s commitment to a cashless economy remains steadfast, and it continues to invest in promoting digital transactions.
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