The central government has dismissed rumours that it is considering imposing GST on UPI transactions above Rs 2,000. The Finance Ministry has clarified that there is no such proposal under consideration at present, and reports about GST on UPI transactions are completely false.
No MDR Charges on UPI Transactions
The Central Board of Direct Taxes (CBDT), through a notification issued on December 30, 2019, removed the Merchant Discount Rate (MDR) on Person-to-Merchant (P2M) UPI transactions.
This notification came into effect from January 2020.
Also Read- GST Rate Changes for Some Goods and Services: Check List
Currently, there are no MDR charges on UPI transactions. Therefore, there will be no GST on UPI transactions either. Person-to-Merchant UPI transactions refer to payments made between a customer and a merchant.