look news india
In the next meeting, the GST Council may discuss the proposal to impose 18 percent GST on low value payments through debit and credit cards. CNBC-TV-18 has reported this news quoting sources. It will be collected from the GST payment aggregator. A payment aggregator is a third party platform that helps the merchant to accept payments. With their help, no merchant needs to set up their own payment gateway. Razorpay, Paytm and GooglePay are examples of payment aggregators.
The government demonetised Rs 2,000 notes and then stopped charging service tax from aggregators on transactions below Rs 2,000 to promote digital transactions. Now this may be taxed again. However, the government does not tax the entire transaction amount.
what is the whole matter
Basically, payment aggregators charge some money from merchants for providing their services. This is 0.5-2 percent of each transaction. Most aggregators have kept it at 1 percent. The service tax levied by the government on this amount is 0.5-2 percent. Therefore, it will not directly affect the common people. But this will cause problems for small shopkeepers.
If the government starts levying service tax on every transaction less than Rs 2000 then online transactions will be affected
aggregators will pass on this burden to the shopkeepers. To reduce this burden, shopkeepers may stop accepting online payments for small transactions or start collecting from customers.
