Quick Summary
The Department of Financial Services (DFS) has initiated consultations with banks, the Reserve Bank of India (RBI), and the National Payments Corporation of India (NPCI) on whether GST slab for mandatory registration and return filing needs revision. According to banking sources, some lenders have p
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FAQ :
Banks have proposed increasing the annual turnover threshold for mandatory GST registration and return filing for merchants to Rs 1 crore.
Currently, merchants supplying goods with an annual turnover exceeding Rs 40 lakh and service providers crossing Rs 20 lakh must register on the GST portal.
The proposal aims to ease compliance burdens for merchants and boost digital payment adoption, encouraging the formalisation of the economy.
The consultations are also linked to discussions on introducing a merchant discount rate (MDR) for UPI transactions, with banks suggesting it only applies to merchants with turnover above Rs 1 crore.
The review was triggered by the Karnataka Commercial Tax Department issuing notices to merchants with turnover above Rs 40 lakh, leading some to revert to cash payments.
Stakeholders expect the DFS to complete its review in the coming months, potentially leading to revised GST slabs.
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