The Kerala State Finance Minister Thomas Isaac has recently asked all the local bodies to depute an officer or Financial Expert to become GST compliant, besides issuing guidelines on the incidence of Goods and Services Tax (GST) on various public works undertaken by them.
For this purpose, each local body should take separate GST registration in the name of their respective secretaries. The government directed the local bodies to make relevant entries regarding to all sale, purchase, and net payments and file these on the GST portal promptly.
The GST amount will be deposited by the respective local body secretary within five working days. When the officials miscalculated or wrongly filed the GST returns would be penalised.
The State government has notified the GST rates for some of the construction materials such as cement, tiles, solid blocks, paint, and glass in the 28% slab, bitumen, steel, timber, and PVC pipes in the 18% slab, and broken stone (aggregate) and soil in the 5% slab.
Under the new GST regime, all the indirect taxes such as Excise duty, Service Tax, sales tax, VAT, luxury tax, entry tax etc. prevailed in India was subsumed.
Sales made by the local bodies will attract GST as per the notified rates. The services which are provided by the local bodies are tax free. However, GST will be levied on the rent component of shopping complexes and auditoriums. The fee paid for building permits or regularisation of construction under the Kerala Building Rules is also exempted from GST.
