GST on UPI payments: The Ministry of Finance refuted the claim and termed the reports ‘completely false, misleading, and without any basis’. It strongly denied the claims of levying GST on UPI payments above Rs 2,000.
The government on Friday rejected the claims that it is planning to levy Goods and Services Tax (GST) on Unified Payments Interface (UPI) transactions above Rs 2000. “There is no such proposal under consideration,” the government clarified in an official press release. The Finance Ministry said the claims are “completely false, misleading, and without any basis.”
The government had to issue a clarification because several reports and social media posts claimed that the government is considering imposing an 18 per cent GST on UPI transactions above Rs 2,000. One of the fake social media posts is shared below.
Fake social media post claiming GST on UPI payment
Government called out such fake claims
“Currently, there is no such proposal before the government,” the ministry said in a statement. It further explained that GST is levied on charges, such as the Merchant Discount Rate (MDR), relating to payments made using certain instruments. Effective January 2020, the Central Board of Direct Taxes (CBDT) has removed the MDR on person-to-merchant (P2M) UPI transactions. “Since currently no MDR is charged on UPI transactions, there is consequently no GST applicable to these transactions,” the ministry said.
It issued a post on X and stated, “Claims that Government is considering levying Goods and Services Tax #GST on #UPI transactions over Rs 2,000 are completely false, misleading, and without any basis. Currently, there is no such proposal before the Government.”
As per the official statement, the UPI transaction values have seen an exponential increase, growing from Rs 21.3 lakh crore in FY 2019-20 to Rs 260.56 lakh crore by March 2025.
The ministry also said the government remains committed to promoting digital payments via UPI.
