GST Council clears 20% cashback on digital payments, with Rs. 100 cap

The Goods and Services Tax (GST) Council cleared a pilot project to offer digital incentives, in the form of cashback of 20% of GST paid on business-to-consumer transactions using RuPay and BHIM platforms, subject to a cap of Rs 100 per transaction.

Revenue shortfall concerns and issues being faced by micro, small and medium enterprises (MSMEs) dominated the 29th meeting of the GST Council. The Council approved a six-member ministerial panel, headed by Minister of State for Finance Shiv Pratap Shukla, to look into the issues of MSMEs.

“We have decided to undertake a pilot project. A broad framework has been worked out so that users of RuPay card, BHIM, Aadhaar, UPI, USSD transactions can be given the incentives because these are mostly used by poor people,” said former Finance Minister Piyush Goyal, adding that the pilot programme will be implemented in any state on a voluntary basis.