WordsGoods and services tax
GST
Short for goods and services tax. On a credit card, the bank adds it at 18 per cent to its own fees, interest and charges, like an annual fee, a late fee or a forex markup; HDFC Bank’s MITC, for example, applies it to all of them, as central and state tax or as integrated tax.
Interest on loans is usually exempt from GST, but the government’s exemption leaves out interest on credit cards, so card interest carries it. RBI’s rules don’t let a bank charge interest on unpaid tax, and HDFC Bank’s MITC says the GST on a statement’s fees and interest shows up on the next month’s statement.
Where this comes from
- HDFC Bank, Key Fact Statement cum MITC for Credit CardsVersion 4.12, 30 September 2026: Part I, L) goods and services tax, and the A) v. illustration
- Government of India, Notification No. 12/2017-Central Tax (Rate)28 June 2017, as issued: entry 27(a)
- RBI, Credit Cards and Debit Cards: Issuance and Conduct Directions, 2025Paragraph 23(2), as updated 1 October 2026
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