Delhi to oppose GST on online payments below ₹2,000: Atishi

Delhi government opposes Centre's proposal to tax online transactions under ₹2,000, fearing impact on small businesses and consumers.

The Delhi government will oppose the Centre’s proposal to impose a tax on payment aggregators for online transactions below ₹2,000 in value at the Goods and Services Tax (GST) Council meeting as the move is likely to hit small businesses and consumers, said Finance Minister Atishi on Sunday.

Ms. Atishi’s remarks come a day ahead of the crucial 54th GST Council meeting, where the proposal to impose an 18% GST on payment aggregators for facilitating online transactions of small value might come up for discussion, among a host of other issues.

The panel is headed by Union Finance Minister Nirmala Sitharaman and includes Ministers from the States.

Till now, any online transaction below ₹2,000 in value is exempt from such a tax, with payment aggregators charging merchants a fee varying from 0.5% to 2% per transaction.

It is feared that the imposition of GST on transactions of small value may result in payment aggregators passing on this extra cost to merchants.

Slamming the proposal, Ms. Atishi termed it “hypocrisy” on the part of the Prime Minister Narendra Modi-led Union government, which she said has been promoting digital transactions for a cashless economy for years now.

Mr. Atishi said if the proposal is approved, all small online purchases made via debit or credit card will be taxed.