New Delhi: A former Reserve Bank of India (RBI) governor has urged the Goods and Services Tax (GST) council to keep UPI person-to-merchant transactions above Rs 2,000 outside the ambit of GST net. C. Rangarajan, who served as the governor of the RBI between 1992 and 1997, has said that India should first decide if the UPI payment system needs to carry a cost and whether the time is fit to impose it, reported New Indian Express.The 94-year-old former RBI governor said that while UPI doesn’t have to remain free forever, but there is a strong case for treating it as a public good.Rangarajan made the remarks while speaking at an event marking the launch of a book ‘Cashless Nation: How UPI Changed Everything’ authored by Dr Santanu Paul and B Sambamurthy at IIT Madras.“There is also the argument that 75% of transactions will not bear any charge. But that cuts both ways. If 75% of transactions will not carry a cost, why introduce the charge at all,” said Rangarajan.Last month, the Bharatiya Janata Party (BJP)-led Union government had decided to impose a Merchant Discount Rate (MDR) on certain transactions made via UPI apps. These apps were earlier entirely exempt from MDR as there was an effort to promote online instant payment apps.While the term includes the word “discount”, MDR is actually a cost – it refers to the charges levied at the time of the transaction itself being made, on behalf of the bank or payment settlement agency that processes the transaction.Person-to-person MDR is still not being imposed, as the new 0.4% rate applies only to person-to-merchant transactions above certain thresholds.The Congress party has called the MDR a ‘tax’, with Congress MP and leader of opposition in Lok Sabha Rahul Gandhi saying, “He [Modi] has put a tax on every single Indian person by taxing UPI and giving a huge amount of money to the United States. Modi-ji, please stop lying down in front of the United States. Have a spine, stand up and take back the UPI tax.”