GST rate on Water Treatment plant for water supply scheme

[N Balachandran]

Sir,

We have recd the order from Drinking Water & Sanitation Dept , Govt of different states for supply and installation and Maintenance of conventional water treatment plant for Rural pipe water supply scheme. . The Central Board of Indirect Taxes (CBIC) has recently increased the rate of GST from @12% to 18% on works contract services involved in the execution of government contracts vide Notification Number 15/2021 - Central Tax (Rate) dated 18.11.2021 which amended Notification Number 11/2017- Central Tax (Rate), dated the 28th June, 2017 (this notification was already amended several time, so it should be read in conjuncture with latest amendment made). As per the said notification, CBIC has substituted the words – “Union territory, a local authority, a Governmental Authority or a Government Entity” with the words – “Union territory or a local authority” which is going to be effective from 01.01.2022.

In view of the above, what will be GST rate is applicable on the above projects

Thanks with Regards

N Balachandran

AI Summary

GST Rate for Government Water Treatment Contract Raised to 18% Effective January 1, 2022, per Notification 15/2021. A query was raised regarding the applicable Goods and Services Tax (GST) rate for a government contract involving the supply, installation, and maintenance of a conventional water treatment plant for a rural water supply scheme. The Central Board of Indirect Taxes and Customs (CBIC) increased the GST rate from 12% to 18% for works contract services in government contracts, effective January 1, 2022, as per Notification Number 15/2021. This amendment altered the entities covered by the previous notification. A response directed the inquirer to refer to a previous discussion with Issue ID 117699 for further guidance.