The Government has refuted claims of GST on UPI transactions over ₹2,000, stating that no such proposal exists. With the Merchant Discount Rate (MDR) removed for Person-to-Merchant transactions since January 2020, UPI transactions are exempt from GST. To foster digital payments, an Incentive Scheme has been implemented, supporting small merchants and low-value transactions with fund allocations rising significantly—₹1,389 crore in FY2021-22 to an estimated ₹3,631 crore for FY2023-24. India leads globally, accounting for 49% of real-time transactions in 2023, with UPI transaction values projected to reach ₹260.56 lakh crore by March 2025.
