If you use Google Pay, PhonePe or Paytm, then there is an important news for you. The government has recently made a big statement regarding the tax levied on UPI payments, know more.
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UPI Transactions: The use of UPI is growing rapidly in India and around the world. Whether it is to pay the vegetable vendor or to do online shopping, most people now use UPI. Recently there were reports that transactions above Rs 2000 through UPI will be taxed. Now the government has clarified its position and has completely rejected these claims.
Ministry’s statement on UPI
According to a report by Financial Express, Rajya Sabha MP Anil Kumar Yadav had asked in Parliament whether the government is considering imposing GST on UPI transactions above Rs 2000. He also asked whether the public has submitted any representation opposing this move.
The Finance Ministry has confirmed that there will be no tax on UPI (Unified Payments Interface) transactions above Rs 2000. Addressing recent rumours, the ministry termed the reports suggesting imposition of GST (Goods and Services Tax) on UPI transactions above Rs 2000 as completely false and baseless.
Government’s reply in Parliament
Responding to the question, Minister of State for Finance Pankaj Chaudhary said that decisions related to GST are taken only on the recommendations of the GST Council and no such recommendation has been made so far. The Revenue Department also confirmed that the GST Council is a constitutional body and any new tax can be implemented only on the basis of its recommendations.
At present, no GST is levied on any type of UPI transaction, whether person-to-person (P2P) or person-to-merchant (P2M), irrespective of the amount of the transaction. The government has expressed its commitment to promote digital payments through platforms like UPI, which are popular due to their speed, simplicity and cashback offers.
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