India Seeks Review of GST on UPI Merchant Fees

The Indian government hopes the GST Council will review the 18% Goods and Services Tax imposed on merchant discount rates for UPI transactions, according to a government source. The GST Council is scheduled to meet on October 7, though it is unclear whether the issue will be discussed at that meeting.

Earlier this month, India’s payments authority announced that fees would be introduced on large UPI payments made to merchants from October 15. Retailers and opposition parties have raised concerns that the charges could eventually increase costs for consumers.

The government is also expected to hold discussions with banking associations to prevent the costs from being passed on to customers. Talks with trader groups are planned to ensure merchants continue accepting UPI payments.

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