From 1st April 2022, rate of tax along with the claiming of Input Tax Credit and the reporting details of the same in GSTR 1 has undergone major changes.
We are trying to explain the same in an easy way as below:
Nature of BRICKS covered:
| Tariff Item | Description | Rate till 31.03.22 | Rate from 01.04.22 (Concessional)* | Rate from 01.04.22 (Regular) |
| 6815 | Fly ash bricks or fly ash aggregate with 90 per cent. or more fly ash content; Fly ash blocks | 5% (2.5 + 2.5) | 6% (3+3) | 12 (6+6) |
| 6901 00 10 | Bricks of fossil meals or similar siliceous earths | 5% (2.5 + 2.5) | 6% (3+3) | 12 (6+6) |
| 6904 10 00 | Building bricks | 5% (2.5 + 2.5) | 6% (3+3) | 12 (6+6) |
| 6905 10 00 | Earthen or roofing tiles | 5% (2.5 + 2.5) | 6% (3+3) | 12 (6+6) |
* Concessional Rate
1. Exclusive ITC – ITC cannot be taken with respect to tax charged on goods / services used exclusively in supplying above goods.
2. Common ITC – ITC is required to be reversed with respect to tax charged on goods / services used partly for supplying above goods and party for other goods on which ITC is eligible.
In nutshell, ITC cannot be claimed with respect to above goods, if taxpayer opts for 6% composition scheme.
Other Imp. Matters
1. Manufacturer of above mentioned goods cannot opt for composition levy u/s 10(1) of the Act i.e. 1% tax payment.
2. General limit for registration under GST for supply of goods is Rs. 40 Lacs. However, for a person supplying above mentioned goods, the threshold limit will be Rs. 20 Lacs.
Reporting in GSTR 1:
1. Reporting for the tax rate of 12% doesn’t have any issue.
2. Reporting for the tax rate of 6% will have issue as there is no specific rate of 6% while reporting the details in GSTR 1. So, taxable value is to be entered in the 5% heading and in the tax, manually 3% / 6% is to be mentioned.
Source:
1. Notification No. 01/2022 and 02/2022 – Central Tax Rate dated 31.03.2022
2. Notification No. 03/2022 and 04/2022 – Central Tax dated 31.03.2022 (Joinder Notification No. 10/2019 and 14/2019 – Central Tax dated 07.03.2019)
3. GSTN Advisory dated 10.05.2022 for reporting of 6% in GSTR 1