Anyone involved in the Indian construction and manufacturing industry needs to understand the GST rates on bricks. Bricks are a crucial construction component that falls under GST. The government has also notified alterations made to the brick c. This post narrates the basics of the brick GST rate.
Introducing the Basics of GST on Bricks
On March 31, 2022, the Indian Government notified changes on bricks manufacturers. These changes came into effect from April 1, 2022. The CBIC, or Central Board of Indirect Taxes and Customs, has issued the GST rates for brick. As per the rates considered, the government has changed and included GST for blocks, fly ash bricks, building bricks, as well as roofing tiles. The rates are 12% with ITC or Input Tax Credit and 6% without ITC. These rates were introduced on April 1, 2022.
Previous and Current GST Structure for Bricks in India
Before April 01, 2022, construction and building material suppliers could get the composition scheme (under 1% GST without ITC and 5% GST with ITC). But after the new announcement made by the Indian Government, the present-day GST structure for bricks seems to be different. Here’s a run-down of the points that mention these changes in brief:
- Considering the new tax rates, there’s been a higher cement brick GST rate, with a hike of 12% on specific products.
- These products might be supplied with a 6% GST rate, provided that there wouldn’t be any ITC benefit in that case with regard to the services or goods used for supplying the goods.
- Suppliers of specified products cannot get composition scheme benefits, which falls under CGST Act Section 10
- The registration threshold limit for these suppliers has been decreased to Rs. 20 lakhs, which was earlier Rs. 40 lakhs. That means suppliers of specific products need to register as regular taxpayers under the goods and services tax law in case their annual turnover is more than Rs. 20 lakhs.
A Tabulated Format Indicating the Revised Brick GST Rate Launched by the Government
So, as described above, brick manufacturers whose turnover exceeds Rs. 20 lakhs per anum need to register under GST. The following are the revisions made by the Indian government as of April 1, 2022. The new tax structure includes a gst rate on bricks comprising 6% (without ITC) and 12% (with ITC) for these products:
| Products | HSN code |
| Sand lime bricks (for stone inlay works) | 68 |
| Fossil meals bricks | 6901 00 10 |
| Refractory bricks | 6902 |
| Bricks of moulded or pressed glass | 7016 |
| Building bricks | 6904 10 00 |
| Fly ash bricks | 6815 |
The Implications of the New GST Rates: What Do You Need to Know?
According to the implications of this new scheme, the following are the things you must learn:
- The suppliers cannot get any benefits from the composition scheme as of April 1, 2022. So, they must file the form GST CMP-04 on the portal.
- The taxpayer needs to file monthly returns in Form GSTR-3B as well as GSTR-1. Note that an eligible supplier must choose the QRMP scheme (Quarterly Return & Monthly Payment).
- Moreover, the taxpayer who transforms from the previous scheme composition to the current scheme must issue the tax invoice rather than their supply bill to supply specific products.
Now that you have discovered the new GST tax initiatives made by the government, it’s time to read the following FAQs and answers.
FAQs
Q1. What is the HSN code of Fly ash bricks?
The HSN code of Fly ash bricks is 6815.
Q2. Are there any benefits for taxpayers who choose the 6% instead of 12%?
Unlike the previous composition scheme under CGST Act Sec 19, the new scheme does not have any other benefits besides lower rates of GST. The taxpayer must comply with the provisions under this law, like issuing documents, filing returns regularly, and paying the amount when noticed on time.
Q3. What are the HSN codes of refractory and building bricks?
The HSN codes of building and refractory bricks are ‘6902’ and ‘6904 10 00’, respectively.
Q4. Do suppliers of specified products not registered under GST need to file for GST after the launch of the new scheme?
Suppliers manufacturing specified products should register under the scheme only if their annual turnover is more than Rs.20 lakhs. The previous threshold limit was Rs. 40 lakhs, but now it has been reduced. These suppliers should apply for GST registration within a time span of 30 days from their GST liability to get an input tax credit on stocks.
Q5. What is the rate of GST on fly ash bricks?
The rate of GST on fly ash bricks is 12%.
Q6. What are the HSN codes of sand lime bricks?
The HSN code of sand lime bricks is 69.
Q7. What is the previous and current turnover threshold for the GST registration?
The previous point for GST was only when the turnover of the supplier exceeded Rs.40 lakhs annually. But now, it has been increased to Rs.20 lakhs annually.
Q8. What are the GST rates for individuals who haven’t opted for the composition scheme?
Earlier, the brick GST rate for individuals who haven’t opted for the composition scheme was 5%. In addition, they could claim credits on inputs. After the new scheme, the GST rate has witnessed a hike of 12%, including ITC.
Q9. What is the eligibility for the composition scheme for registered individuals?
Earlier, the individual could choose the composition scheme with an annual turnover of below Rs.1.5 crores. But now, the registered individual cannot choose this scheme but can choose a special composition scheme with GST at 6% without ITC.