GENERAL28 Sept 2026
If neither tax nor fee, what is this ‘expropriation’, Supreme Court asks Govt on UPI MDR charges
The Supreme Court has refused to pause the new 0.4% merchant discount rate (MDR) on Unified Payments Interface (UPI) person-to-merchant payments above ₹2,000. It affects businesses receiving such payments, with the charge capped at ₹300 per transaction for payments of ₹75,000 and above. The court has asked the government to respond within four weeks. Watch this closely, as your UPI costs may change.
Key Statutory Highlights
- The Supreme Court on September 28, 2026 refused an interim stay on the 0.4% merchant discount rate for UPI person-to-merchant transactions above ₹2,000.
- For transactions of ₹75,000 and above, the MDR is capped at ₹300 per transaction.
- The court issued notice to the Union of India and directed counter affidavits to be filed within four weeks.
Actionable Advice for Taxpayers / Founders:If you accept UPI person-to-merchant payments above ₹2,000, review how you record and price in this 0.4% charge, and keep an eye on the case as it moves. Since the matter is still before the Supreme Court, treat the position as unsettled and check with your CA before changing your billing systems.
Statutory Disclaimer: TaxQue Shorts are AI-assisted editorial briefs for compliance awareness. This brief has not passed every source check; confirm the original notification before acting. This does not constitute formal legal or CA counsel.
TaxQue News Desk
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