{"id":1298813,"date":"2025-08-16T08:24:23","date_gmt":"2025-08-16T02:54:23","guid":{"rendered":"https:\/\/trak.in\/stories\/?p=1298813"},"modified":"2025-08-16T08:24:58","modified_gmt":"2025-08-16T02:54:58","slug":"gst-slab-can-be-increased-to-rs-1-crore-for-boosting-digital-payments","status":"publish","type":"post","link":"https:\/\/trak.in\/stories\/gst-slab-can-be-increased-to-rs-1-crore-for-boosting-digital-payments\/","title":{"rendered":"GST Slab Can Be Increased To Rs 1 Crore For Boosting Digital Payments"},"content":{"rendered":"\n

The Department of Financial Services (DFS) has been holding discussions with banks, the Reserve Bank of India (RBI), and the National Payments Corporation of India (NPCI) on revising the Goods and Services Tax (GST) threshold for merchants. According to a Moneycontrol report, some banks have proposed increasing the annual turnover threshold for GST registration and filing to \u20b91 crore and introducing a merchant discount rate (MDR) for Unified Payments Interface (UPI) transactions to ease compliance and sustain digital payment adoption.<\/p>\n\n\n\n

\"GST<\/figure>\n\n\n\n

Proposed GST Threshold Hike and MDR Reintroduction to Boost UPI Adoption<\/strong><\/p>\n\n\n\n

Currently, GST rules mandate registration and filing for merchants with annual turnover exceeding \u20b940 lakh for goods<\/a> and \u20b920 lakh for services. DFS is evaluating whether this slab should be raised, with data being collected from banking sources, including current account records. The proposal follows Karnataka\u2019s Commercial Tax Department sending GST notices to merchants with turnover above \u20b940 lakh, calculated based on UPI transactions. These notices led many merchants to reduce or abandon UPI payments in favour of cash, raising concerns about reversing progress in formalising the economy and promoting digital payments.<\/p>\n\n\n\n

The MDR proposal is also under review. MDR is a fee charged by payment companies to merchants for processing digital transactions. Payment firms have been advocating for its reintroduction after government subsidies for UPI transactions were cut earlier this year. Supporters of the \u20b91 crore threshold argue it would shield small merchants from the administrative burden of GST compliance while maintaining incentives for accepting UPI payments.<\/p>\n\n\n\n

DFS, RBI Reviews Aim to Balance GST Compliance and Digital Payment Growth<\/strong><\/p>\n\n\n\n

While the GST Council and the Department of Revenue oversee tax policy, DFS plays a critical role in coordinating with financial institutions and analysing the economic implications. Sources indicate that such reviews are part of DFS\u2019s regular engagement with stakeholders, though any changes would depend on political considerations. The RBI is also studying UPI\u2019s operational costs, which could influence future policy on transaction charges and merchant adoption strategies. The combined proposals aim to balance tax compliance, ease of doing business, and continued momentum for India\u2019s digital payments ecosystem.<\/p>\n\n\n\n

Summary:<\/strong><\/p>\n\n\n\n

The Department of Financial Services, in consultation with RBI and NPCI, is considering raising the GST registration threshold to \u20b91 crore and reintroducing MDR for UPI transactions. The move aims to reduce compliance burdens, encourage digital payments, and sustain growth, while balancing tax policy, merchant adoption, and operational cost concerns.<\/p>\n","protected":false},"excerpt":{"rendered":"

The Department of Financial Services (DFS) has been holding discussions with banks, the Reserve Bank of India (RBI), and the National Payments Corporation of India (NPCI) on revising the Goods and Services Tax (GST) threshold for merchants. According to a Moneycontrol report, some banks have proposed increasing the annual turnover threshold for GST registration and […]<\/p>\n","protected":false},"author":26,"featured_media":1298949,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[8471],"class_list":["post-1298813","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-gst-slab"],"acf":[],"yoast_head":"\nGST Slab Can Be Increased To Rs 1 Crore For Boosting Digital Payments - Trak.in - Indian Business of Tech, Mobile & Startups<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/trak.in\/stories\/gst-slab-can-be-increased-to-rs-1-crore-for-boosting-digital-payments\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"GST Slab Can Be Increased To Rs 1 Crore For Boosting Digital Payments - Trak.in - Indian Business of Tech, Mobile & Startups\" \/>\n<meta property=\"og:description\" content=\"The Department of Financial Services (DFS) has been holding discussions with banks, the Reserve Bank of India (RBI), and the National Payments Corporation of India (NPCI) on revising the Goods and Services Tax (GST) threshold for merchants. 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