The steer the country away from cash to adopt digital transactions, the centre has decided to waive off service tax on debit and credit card transactions of up to Rs 2,000. Currently, you pay 15% as the tax on these transactions.
The tax breaks for using cards comes after Prime Minister Narendra Modi last month announced that Rs 500 and Rs 1,000 denomination notes would, just hours later, be illegal, taking the whole country by surprise.
Lifting service tax on card transactions is one of the several initiatives the centre has taken to promote payments through digital modes.
NITI Aayog, Government of India’s policy think-tank, has announced to give district collectors Rs 10 as a reward for every individual who has shifted to electronic payment in his or her jurisdiction, adding that the top ten performing districts will also be awarded the Digital Payment Champions of India Award by NITI Aayog/Government of India.