GST ON BRICKS: -

The Central Board of Indirect Taxes and Customs i.e., CBIC has issued a New GST Rate for Brick manufacturing vide the notifications on 31^st March 2022. And the Government has increased the GST rates for Fly Ash Bricks, Blocks, Building Bricks, and roofing tiles to 12% with Input Tax Credit (ITC)  and 6% without ITC from the existing rate of 5%. These notifications came into effect from 1^st April 2022. The present article briefs theNew GST Rate for Brick Manufacturing Sector.

APLICABILITY OF REVISED GST RATE: -

All the brick that are manufactured with a turnover above Rs.20 lakh are required to be registered and pay GST. Earlier, the limit was Rs 40 lakh.Prior to April 01, 2022, the suppliers of Construction and Building Materials could either opt for the composition scheme (1% GST without ITC) or the normal scheme (5% GST with ITC) in order to discharge their GST liability.

Post you may also like: income-tax-return

New GST Rate structure for Brick Manufacturing

• Under the new tax rate’s structure, the Government has notified a higher rate of GST which is12% on the specified products, where the benefit of claiming ITC would be available to the supplier.
• Alternatively, the specified products can be supplied with the lower GST rate of 6% with a condition that the benefit of ITC would not be available in respect of goods or services used (exclusive or common) in supplying such goods.
• The suppliers of the specified products would no longer be able to avail of the benefit of the composition scheme under Section 10 of the CGST Act.
• The threshold limit of registration for such suppliers has also been decreased from Rs. 40 lakhs to Rs. 20 lakhs. In other words, the supplier of specified products would be required to register as a normal taxpayer under the GST law if their aggregate turnover in the financial year exceeds Rs. 20 lakhs.

• PARTICULARS	EARLIER	AS NOW
  GST Rates for individuals not opting for the composition scheme	Earlier, a registered person involved in manufacturing & trading of bricks was charged GST at 5% and could claim a credit on inputs.	As per Notification No. 02/2022-Integrated Tax (Rate), the GST rate has been increased to 12% with ITC.
  Turnover threshold for GST registration	The point for GST registration earlier was only if the annual turnover exceeded Rs.40 lakhs	As per Notification No. 03/2022-Central Tax, the threshold for GST registration has been reduced to Rs.20 lakhs
  Composition scheme eligibility for registered person	Earlier a registered person could opt for the composition scheme if the aggregate annual turnover in the previous year didn’t exceed Rs.1.5 crores	As per Notification No. 04/2022-Central Tax, a registered person cannot opt for composition scheme. However, as per Notification No. 02/2022-Central Tax, such a registered person can avail the special composition scheme and pay GST at 6% without availing of the ITC.