# Rates of GST

## A. GST Rates on Goods

Seven CGST rates notified: 0.125%, 0.75%, 1.5%, 2.5%, 6%, 9%, 14% (with equivalent SGST/UTGST)
Seven IGST rates for goods: 0.25%, 1.5%, 3%, 5%, 12%, 18%, 28%
Certain specified goods are exempt.

## B. GST Rates on Services

Six CGST rates: 0.75%, 2.5%, 3.75%, 6%, 9%, 14% (with equivalent SGST/UTGST)
IGST rates on services: 1.5%, 5%, 7.5%, 12%, 18%, 28%
Nil rate notified for certain services.
28% — services like gambling, entertainment events, amusement facilities (casinos, IPL, race clubs).
5% — selected services such as GTA service, restaurant service (subject to no ITC).
Residuary rate: Services not under any specific heading → 18% (CGST 9% + SGST 9%, or IGST 18%).

## C. GST Rates in the Real Estate Sector

Type	Rate (without ITC)
Construction of affordable houses (carpet area: ≤60 sqm in metros / ≤90 sqm in non-metros AND value ≤ ₹45 lakh)	1%
Other residential houses (non-affordable)	5%
Commercial apartments in RREP where commercial area ≤ 15% of total	5%

### Conditions for the Above Rates

1. No ITC allowed.

2. 80% of inputs/input services must be purchased from registered persons — EXCLUDING: development rights, long-term land lease, FSI, electricity, diesel, motor spirit, natural gas.

3. If purchases from registered persons fall below 80%, the promoter pays GST under RCM u/s 9(4) @ 18% on the shortfall.

4. Cement received from an unregistered person → promoter pays GST under RCM @ 28%.

5. Capital goods → promoter pays under RCM at the applicable rates.

Worked example

### Example 1

Example 1 (Affordable Housing): Builder M/s Aashiyana constructs a flat in Pune (metro) with 58 sqm carpet area, selling at ₹42 lakh. Both conditions are met (≤60 sqm, ≤₹45 lakh) → GST @ 1% without ITC.

### Example 2

Example 2 (Shortfall in 80% rule): A promoter procures only 70% of qualifying inputs from registered persons. Shortfall = 10% of qualifying value. The promoter pays GST @ 18% under RCM on this 10% shortfall.

### Example 3

Example 3 (Cement RCM): Promoter buys cement worth ₹10 lakh from an unregistered dealer. Regardless of the 80% calculation, GST @ 28% is payable by the promoter under RCM specifically on cement.

### Example 4

Example 4 (Residuary services): A consultancy service has no specific heading. It is taxed at the residuary rate of 18% IGST (or 9% + 9%).

⚠️ Common exam mistakes

Claiming ITC despite opting for 1%/5% real estate scheme — ITC is BLOCKED.
Excluding cement from the special RCM rule — cement from unregistered persons attracts RCM @ 28% regardless of the 80% threshold.
Including development rights, long-term land lease, FSI, electricity, diesel, motor spirit, or natural gas in the 80% test — these are excluded.
Treating 5% as 'standard' real estate rate — affordable housing is 1%; commercial in RREP with >15% commercial area is NOT eligible for 5% concessional rate.
Confusing the number of CGST rates for goods (7) vs services (6).
Forgetting that the residuary rate for services is 18%, not 28%.

Reference:

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GST Rates on Goods, Services and Real Estate

Worked example

⚠️ Common exam mistakes