Big Change in Digital Payments: GST Council Proposes 18% GST on Online Payments Under Rs. 2000!
The GST Council proposes imposing an 18% GST on merchant fees for transactions under ₹2000 using credit and debit cards or QR codes. This decision was discussed at a recent meeting, but due to member opposition, the proposal was referred to the fitment committee for further review.
Major Decision on Online Payments
On Monday, the GST Council held a significant meeting to discuss online payments through credit and debit cards. According to media sources, an 18% GST is proposed on merchant fees charged for transactions below ₹2000. This GST will also apply to payment gateways.
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Impact on Payment Aggregators
The proposal means that payment aggregators will now have to charge 18% GST on the fees they collect for processing transactions via credit cards, debit cards, or QR codes. If you pay ₹2000 or less through any of these methods, the aggregator fee will now be subject to 18% GST.
Opposition and Next Steps
However, council members strongly opposed the proposal, claiming that such a tax would have a direct impact on consumers. Following the backlash, the GST Council decided to refer the proposal to the fitment committee for further discussion. Prem Chand Aggarwal, Uttarakhand’s Finance Minister, confirmed that the committee is currently reviewing the situation.
