Question

The local GST tax rate which is applicable for the installation of the borewell is 18%, which is already cleared by the GST tutorials. Now, the query is that we want to know the GST tax rate of the installation charges of Borewell which is done for the government. The service of installation of borewell is given to the government.

Answer

Concessional rate of tax is given at S. no 3 (iii) & 3(vii) of Notification no. 08/2017-Integrated tax . This Rate of tax is applicable if the activity performed by you is covered with in the description given in column 1. The relevant portion of notification is reproduced below:-

Sr. No.,Chapter, Section or Heading & Description of Service

 Rate (per cent.) Condition
3. Heading 9954

(iii) Composite supply of works contract as defined in clause (119) of section 2 of the Central Goods and Services Tax Act, 2017, supplied to the Central Government, State Government, Union territory, a local authority, a Governmental Authority or a Government Entity] by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of, -

(a) a historical monument, archaeological site or remains of national importance, archaeological excavation, or antiquity specified under the Ancient Monuments and Archaeological Sites and Remains Act, 1958 (24 of 1958);
(b) canal, dam or other irrigation works;
(c) pipeline, conduit or plant for (i) water supply (ii)water treatment, or (iii) sewerage treatment or disposal.]

12

 [Provided that where the services are supplied to a Government Entity, they should have been procured by the said entity in relation to a work entrusted to it by the Central Government, State Government, Union territory or local authority, as the case may be]
[(vii) Composite supply of works contract as defined in clause (119) of section 2 of the Central Goods and Services Tax Act, 2017, involving predominantly earth work (that is, constituting more than 75 per cent. of the value of the works contract) provided to the Central Government, State Government, Union territory, local authority, a Governmental Authority or a Government Entity.

5

 [Provided that where the services are supplied to a Government Entity, they should have been procured by the said entity in relation to a work entrusted to it by the Central Government, State
Government, Union territory or local authority, as the case may be]

Please note that the activity of installation of borewell is not given seperately. So you have to check whether the same is covered under description given in Column 1. (Reply dt.12/07/2018)