1. GST impact on credit cards: Hasmukh Adhia blasts social media message over utility bills payment being taxed twice

GST impact on credit cards: Hasmukh Adhia blasts social media message over utility bills payment being taxed twice

Revenue Secretary has clarified that the message spreading on social media that a person would be taxed twice if they make payment using credit cards are false.

By: | New Delhi | Updated: July 2, 2017 4:29 PM
Revenue Secretary, Revenue Secretary Dr Hasmukh Adhia, Finance Ministry, Goods and services tax, GST, GST full form, GST rate, GST Council, GST rates, GSTIN, GST invoices, provisional GST ID, final GST ID, Hasmukh Adhia, credit cards, consumers, financial services, banking services, home loan processing fee, fund transfers, debit card, ATM withdrawal beyond the number of free services, issuance of cheque books/drafts/duplicate passbooks, cash handling charges and SMS alerts, what is GST, Twitter, social media, GST Council had decided to levy a tax rate of 18 percent on the use of credit cards. (Source: PTI)

GST impact on credit cards: Revenue Secretary Dr Hasmukh Adhia, through a tweet, has clarified that the message spreading on social media that a person would be taxed twice if they make payment using credit cards are false. Doctor Adhia tweeted that there won’t be a case of double taxation in case of payments being made through credit cards. The Revenue Secretary has urged people to not circulate this message or any such message without confirming with the authorities. Doctor Adhia made the statement on Saturday, just a couple of days after the launch of the Goods and Services Tax. The GST Council had decided to levy a tax rate of 18 percent on the use of credit cards. This is an increase of three percent from the previous rate of 15 percent.

As per provisions of the Goods and Services Tax, apart from credit cards, consumers will now also have to pay more for other financial services such as banking services and insurance premium payments. These financial services will attract a tax rate of 18 percent, instead of the 15 percent charged earlier.

Banking services which will require a higher tax rate are, services such as home loan processing fee, fund transfers, debit card, ATM withdrawal beyond the number of free services, issuance of cheque books/drafts/duplicate passbooks, cash handling charges and SMS alerts.

The Revenue Secretary is using his Twitter handle as a tool to debunk many myths around the new tax regime, which was launched on Saturday. Adhia has also taken to the micro-blogging site to spread information about the tax.

Adhia has tweeted about various other GST topics such as generation of invoices, provisional and final ID, GSTIN, the number of returns to be filed per month, GST rates, etc.

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    Prof. Sanjay Kumar
    Jul 7, 2017 at 8:54 am
    I made a shopping on my credit card and taxes are paid to the seller. Now i am surprised to see in my statement which generated on 1 July gst and other taxes on my payment again debited from my account.Why should I pay double the taxes or should I stop using the C.Card ?
    Reply
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      Kasavan Nambisan
      Jul 6, 2017 at 4:17 pm
      Very valuable information allaying fears of public at large. Thank you Sir,
      Reply
      1. S
        Sasi Kumar
        Jul 5, 2017 at 9:58 am
        I think most of the doubts are valid. But the point is that GST or not, you have to pay for the service and its tax if you pay with your card or use the service of any financial ins ution. That is because, apart from goods, services also have been taxed for quite some time.
        Reply
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          Sudhir Sood
          Jul 4, 2017 at 12:20 pm
          Against a single post of the Revenue Secretary so many queries / apprehensions have been posted. Why no reply is being now posted by the Revenue Secretary Dr. Hasmukh Asia?
          Reply
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            Srikant Bajaj
            Jul 4, 2017 at 9:24 am
            It may not be changed twice in credit card. But, a person who has taken car lease from its employer will be paying huge amount of taxes twice. One has already paid excise at the time of purchase of car, for which we cannot take credit and was paying VAT 14.5 . but with introduction of GST now will have to pay 43 of tax. Thus excise duty on car has been charged twice to these car leasees.
            Reply
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              Anil jain
              Jul 4, 2017 at 8:29 am
              Why GST council is not responding to mails Why is the HSN code for Export Incentives Like MEIS, SEIS, FPS etc?
              Reply
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                Kamesh
                Jul 3, 2017 at 5:13 pm
                Yes. If you pay in installments you may have to pay service tax. Otherwise if u clear before due date we need not pay extra. Please check with your bank.
                Reply
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                  Amit K. De
                  Jul 3, 2017 at 4:05 pm
                  Please clarify in details how it will not be double.. tax if the payment done in credit card. For an example if any one purvhase something say from Big Bazar then he/she will be taxed on the bill and if payment done in credit card it will again be taxed by bank Please clarify and explain.
                  Reply
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                    Prasun Maity
                    Jul 4, 2017 at 10:05 pm
                    Sir if you clear your dues within due date... No charge you have to pay.
                    Reply
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                    Lakshminath Mocherla
                    Jul 3, 2017 at 3:01 pm
                    I am spending 7 to 8 hours a day much to the chagrin of my friends and family reading all news papers and whatsappand what not. They advice me to discard the cell.
                    Reply
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                      Madhava Rao
                      Jul 3, 2017 at 2:55 pm
                      My doubt is ..If I pay my hotel bill of Rs15000 using my credit card the hotel bill will include GST for stay and my credit card will charge me 18 for making the payment of the same through card am I not paying more for the stay by paying GST twice for the same service of my stay at the hotel...will you please clarify..??
                      Reply
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                        Prasun Maity
                        Jul 4, 2017 at 10:09 pm
                        Credit card Payment within due date will not levy any charge. Post due date the contract between you and credit card company changes and it become as loan... so gst will apply post due date if the amount is not cleard
                        Reply
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                        Arup Roy
                        Jul 3, 2017 at 12:37 pm
                        The current government themselves are promoting cashless transaction and have levied double taxation in all transaction we make. Debit card/ Credit card / Cash Withdrawal / Cheque Payments / Net banking to name a few. The most affected are the middle class ried people. Insurance is a sector where the common man ried class invests for their future and the government has levied charges in premium making it costlier for common man. In one hand government is preaching that they are committed to bring down the cost of living for a common man and on the other hand they have levied charges in every thing a common man needs in their daily life. This is HYPOCRISY. The government should themselves practice before they preach.
                        Reply
                        1. H
                          Hasmukh Raval
                          Jul 3, 2017 at 12:28 pm
                          By imposing GST/service charges on debit card etc. will discourage the common people in switching over to the digital payment system. If the govt. wants to encourage the digital payment systems, at least no service/GST charges be levied on debit cards payments etc.
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                            GBNagaraj
                            Jul 3, 2017 at 11:36 am
                            Many over enthusiastic people without going full in to the subject spread wrong messages.
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                              Nat
                              Jul 3, 2017 at 11:09 am
                              EXAMPLE My Electricity Charge. Rs. 100 GST 15 . Rs. 15 Total. Rs. 115 I pay by credit card Credit card statement has only one transaction for the month, which is the Electricity Bill payment. Transactions for the month. Rs.115 GST 18 . Rs. 20.7 This is not only double taxation but there is a cascade of tax-on-tax too. This is because, there is no set-off.
                              Reply
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                                Vishal Puri
                                Jul 3, 2017 at 2:36 pm
                                I think you are who is sad that if you pay electricy bill 100rs by credit card then you need to pay 118 it's tottaly wrong if you pay electricity bill of 100rs by any credit/debit card or net banking mobile banking or using upi then you need to pay just exact amount which is show in your bill means 100rs
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                                  Raj
                                  Jul 3, 2017 at 2:55 pm
                                  Useless crap...
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                                  Nishanth
                                  Jul 3, 2017 at 10:05 am
                                  As I understand, if ₹1000 is ur utility bill. U r using ur credit card for the said amt. Ur service charge is zero, if ur paying full amt in time but if u aren't, normally a interest charge of 3 is taken by the credit card company, that is ₹30. 18 of ₹30 is ₹5.4 is the gst.
                                  Reply
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                                    Nishanth
                                    Jul 3, 2017 at 10:11 am
                                    Typo 3 and 18
                                    Reply
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                                      Nishanth
                                      Jul 3, 2017 at 10:13 am
                                      3 percentage and 18 percentage...couldn't input the symbols ..😐
                                      Reply
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                                      Krishnakumar Prabhakaran
                                      Jul 3, 2017 at 9:58 am
                                      Wah achhe din aa gaga. First of all most tax payers pay good taxes without social security benefits. Then in the name of cashless digitization, we are forced to pay more to use our money in banks. Tax payers committing suicide is next
                                      Reply
                                      1. S
                                        Sukanta Ghose
                                        Jul 7, 2017 at 2:55 pm
                                        Very true Sir this is the acche din indeed I wonder what this Monarchial Govt. is going to do next
                                        Reply
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                                        Kamal
                                        Jul 3, 2017 at 9:01 am
                                        I am unable to understand why their should be higher taxation for insurance premium payment. Kindly clarify if my understanding is correct?
                                        Reply
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                                          Rakesh Lamba
                                          Jul 3, 2017 at 8:55 am
                                          We all have created a terror out of GST. Where as we have forgotten or not ready to accept the positive effects on our business n the nation. Yes there are teaching problems for any thing new you want to start. Some of the small n large businesses are reluctantly n finally are forced (due to its implementation) to register for GST. I personally feel this reluctance is the result of change in business style n this is taking time for everyone to accept, as you have to unreasonable with yourself to adopt the change. Rest all systems need periodical improvement which Government is prepared for.
                                          Reply
                                          1. S
                                            Shanti Gandhi
                                            Jul 3, 2017 at 8:42 am
                                            Ihave understood like this, utility bills are charged GST.. which was called service charges earlier, when you use credit card there is GST which was earlier called service charge. So you end paying 18, 18 , GST , Earlier we were paying15 15 service charges for bill charged by utility companies banking charges. It sounds the same as earlier system. we pay 18 now instead of 15 we paid earlier.
                                            Reply
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                                              pdma
                                              Jul 3, 2017 at 8:24 am
                                              the local channels twist everyting and negative ideas are pushed.plz ask them stop such propogations. any new move will jave teething prblem.
                                              Reply
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                                                Capt DJ Manavalan
                                                Jul 3, 2017 at 8:20 am
                                                Credit card transactions taxed 18 and telephone bill 18 . If payment done by cash only 18 tax. Use of credit/debit cards attract 2-2.5 surcharge in many places. Why?
                                                Reply
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