GST applicable on water projects for Water & Sewage Board

[N Balachandran]

Sir,

Can u please clarify , Whether GST @ 12% or @18% is applicable on Water supply Projects being executed for Municipal Corporation ( Local authority ). Since the works contract executed for Central and state Govt is attracting @ 18% w e f 01 01 2022 as per the recent notification.

Regards

N Balachandran

AI Summary

GST rate distinction for public water and sewage projects hinges on recipient status; confirm local authority versus governmental entity.
Composite works contracts for pipeline, conduit or plant for water supply, water treatment or sewerage treatment supplied to the Central Government, State Government, Union territory or a local authority attract the concessional 12% rate (6% CGST + 6% SGST). With effect from 01.01.2022, supplies to a governmental authority or government entity attract a higher rate; therefore the applicable rate for a Water & Sewage Board depends on whether it is a local authority or a governmental authority/entity, and canals/dams qualify for concessional treatment only if for irrigation.