Daily current affairs · 19 August 2026

Taxation and Payment Systems Amendment Acts 2026 President Assent

President Droupadi Murmu granted assent to the Taxation and Other Laws (Amendment) Act, 2026, and the Payment and Settlement Systems (Amendment) Act, 2026.

The Taxation and Other Laws (Amendment) Act, 2026 provides tax exemptions on interest income and capital gains for Foreign Portfolio Investors investing in Government Securities, replacing the June 2026 ordinance.
The law provides regulatory certainty to foreign cloud service providers utilizing Indian data centres, aiming to boost domestic electronics manufacturing.
The Payment and Settlement Systems (Amendment) Act, 2026 amends the parent 2007 legislation, empowering the Central Government to notify which digital payment modes remain exempt from charges.
This gives statutory flexibility to modify or maintain the zero Merchant Discount Rate policy on Unified Payments Interface and RuPay debit card transactions.

Merchant Discount Rate

The fee charged to a merchant by a bank for accepting payments through digital transactions.

Foreign Portfolio Investors

Passive investors holding foreign financial assets such as stocks and government securities in a domestic market.

The zero-MDR rule currently applies mandated free processing to UPI and RuPay debit card transactions.
Tax exemptions on G-Sec returns for FPIs are aimed at deepening the sovereign bond market.

Discuss how regulatory certainty in digital payments balances consumer adoption with the financial sustainability of payment aggregators.

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