American online payments portal PayPal will levy GST charges on its services starting November 1, 2017, in tune with Goods and Services Tax rules and regulations in India.
PayPal users in India have been prompted to update their GSTIN details on the website at the earliest.
Based on the GST registration details submitted by the user, PayPal will issue tax invoices, an Indian Express report said. Users will also be able to claim input tax credit provided correct GSTIN details are updated on the website.
An 18 per cent tax will be imposed on PayPal services, which is only applicable to the fees charged by the payment gateway, and not the entire amount of purchase price.
Financial and Banking services in India such as debit card, fund transfer, ATM withdrawal, locker rentals, issuance of chequebooks, cash handling charges currently face a higher tax of 18 per cent as compared to the earlier 15 per cent.
Founded in 1998, listed on the Nasdaq Stock Market in 2002 and turned into a wholly owned subsidiary of eBay Inc. in 2015, PayPal operates a payment system that supports online money transfers and serves as an alternative to paper transaction methods like checks and money orders.