GST Council likely to clarify on 18% GST on payment aggregators' gateway fees for cards transactions upto Rs 2,000: CNBC-TV18

Currently payment aggregators, who see digital payments such as QR scanning, POS machine, and net banking, are exempt from GST on transactions below Rs 2,000

India’s GST Council is expected to clarify at its September 9 meeting on whether GST of 18 percent should be levied on digital payments of less than Rs 2,000 made through payment aggregators such as Pine Labs and Razorpay, CNBC-TV18 reported citing sources.

Currently payment aggregators, who see digital payments such as QR scanning, POS machine, and net banking, are exempt from GST on transactions below Rs 2,000. A final decision will be taken by the GST Council on the recommendation of the rate fitment committee, the report added.

According to the fitment committee, these payment aggregators act as intermediaries for such transactions and can’t be treated as banks, so GST should be levied on them, the report added.

Among the other key decisions, tax treatment for insurance premiums, and conditions for sharing GST data with govt agencies are also likely to be taken up.

On health insurance premium, options under consideration include partial relief to reducing the tax rate in to lessen revenue loss to the exchequer.

The proposal to exempt health insurance premium from GST has sparked a debate amid states expressing concerns about the potential revenue loss, which is likely to range between Rs 3,200 and Rs 4,000 crore. However, the final loss figure depends on the retention of ITC, the officials said.

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