UPI Transactions Above ₹2,000 May Soon Attract 18% GST: What It Means for You

UPI Transactions Above ₹2,000 May Soon Attract 18% GST: What It Means for You

Last Updated Apr - 17 - 2025, 04:41 PM | Source : Fela News

The Indian government is considering GST on UPI payments over ₹2,000. Learn how this potential rule could impact individuals, small businesses, and digital paym

The Indian government is reportedly considering a proposal to impose Goods and Services Tax (GST) on UPI (Unified Payments Interface) transactions exceeding ₹2,000. This potential move has stirred widespread conversation among digital payment users, small business owners, and freelancers.

Under the proposed rule, any UPI payment above ₹2,000 could attract an 18% GST charge, especially for business-related transactions. While personal transfers between individuals might remain exempt, merchant payments are likely to be targeted first. Platforms like Google Pay, PhonePe, Paytm, and BHIM could begin reflecting this tax in their transaction summaries.

The aim behind this step is to improve tax compliance, formalize high-value digital transactions, and curb tax evasion. If enforced, this rule might affect daily users—prompting them to split larger purchases—and increase the operational burden for small vendors who might now need to register for GST.

There could be exemptions for essential services such as utility bills, medicines, and educational fees, as well as protections for rural users. The GST Council is expected to issue official guidelines soon, detailing applicability, rate, and implementation timelines. 

Until then, users are advised to monitor transaction values and stay updated on platform changes.

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