New Delhi: July 29, 2025
As India continues to lead globally in digital payments, especially through *Unified Payments Interface (UPI), concerns had been rising among users about possible taxes on transactions. Recent speculation suggested that the government might *impose GST on UPI payments over ₹2,000. However, the Finance Ministry has officially clarified the matter, putting all doubts to rest.
Millions of Indians rely on UPI daily for secure and fast money transfers. Until now, there have been *no charges on UPI transactions, making it a preferred mode of payment across the country. Earlier reports and social media chatter hinted at possible taxation, especially after *RBI Governor Sanjay Malhotra made comments indicating that free digital payments may not continue forever.
What Did the RBI Say?
Sanjay Malhotra, in a recent statement, mentioned that someone would have to bear the cost of maintaining digital payment infrastructure. He implied that *UPI may not remain permanently free, leading many to believe that *charges or GST could soon follow.
His remarks triggered confusion, which intensified after a few media reports claimed the government was considering levying GST on UPI transactions exceeding ₹2,000.
Government’s Clear Stand in Rajya Sabha
Amid this growing anxiety, Union Minister *Pankaj Chaudhary, while responding to a question in the *Rajya Sabha during the Monsoon Session, made the government’s stance crystal clear.
“There is no intention to levy GST on UPI transactions over ₹2,000,” he confirmed.
He added that *the GST Council has made no such recommendation, which effectively rules out any immediate policy change. GST rates and exemptions are finalized only on the *recommendation of the GST Council, which includes representatives from the central government, states, and union territories.
Impact on Revenue and Banking Sector
Pankaj Chaudhary further assured that *government revenue is stable, and there’s no need to explore UPI taxation as an additional income source. For the financial year 2025-26, the *fiscal deficit is estimated at ₹15.69 lakh crore, amounting to 4.4% of GDP. The government’s focus remains on achieving its budgetary goals without burdening digital users.
Addressing another question, the Minister shared insights into staffing in public sector banks. As of *March 31, 2025, nearly **96% of bank positions are filled. Minor dips in workforce strength were attributed to retirements and voluntary resignations. He highlighted that in the last five years, *1.48 lakh employees were recruited. For the 2025-26 financial year alone, 48,570 new hires are expected in government banks.
Key Takeaways:
- No GST on UPI transactions above ₹2,000, as clarified by the government.
- RBI’s remarks were general observations, not policy changes.
- The GST Council has not proposed any new levies on digital payments.
- Government revenue remains unaffected, and the focus is on achieving fiscal targets.
- Public sector banks are actively recruiting and maintaining workforce levels.