The government has clarified that there is no plan to impose GST on UPI transactions above ₹2,000. Reports claiming this are false and baseless.
GST Only on Payment-Related Charges
GST is only applied to charges like the Merchant Discount Rate (MDR) for certain digital payments. Since January 2020, UPI Person-to-Merchant (P2M) transactions have had no MDR, meaning no GST is charged on them.
Government Continues to Support UPI
To boost UPI usage, an Incentive Scheme has been active since FY 2021-22. It supports low-value UPI (P2M) transactions and helps small merchants by lowering transaction costs.
Incentive Scheme Payouts
The scheme’s payouts over the years show the government’s support:
FY 2021-22: ₹1,389 crore
FY 2022-23: ₹2,210 crore
FY 2023-24: ₹3,631 crore
India Leads in Digital Payments
As per the ACI Worldwide Report 2024, India made 49% of all global real-time digital transactions in 2023.
UPI Usage Growing Rapidly
UPI transaction value rose from ₹21.3 lakh crore in FY 2019-20 to ₹260.56 lakh crore by March 2025. P2M transactions hit ₹59.3 lakh crore, showing strong merchant and consumer use.
