--- title: "New GST for Construction Materials 2026: 5% to 18% GST Rate" description: "New GST rate on construction materials in 2026 is 5% to 18% on cement, sand, steel, tiles and bricks. Use Busy to auto-apply the correct GST on every invoice." canonical: "https://busy.in/gst-rates/construction-materials/" author: "Jagdish Prasad" published: "2025-05-15T10:54:40.000Z" category: "GST Rates" --- - GST rates for construction materials in India have changed, with items like cement now at 18% and previously at 28%. - Bricks, sand, and fly ash bricks are taxed at a lower rate of 5%, making them more affordable. - Steel, tiles, and sanitaryware have a mid-range GST rate of 18%, impacting construction costs significantly. - Builders can claim Input Tax Credit (ITC) on GST for materials, but ITC is not available for personal use or completed properties. - Buyers and contractors should verify GST rates, ensure invoices are GST-compliant, and use correct HSN codes to avoid errors. # New GST for Construction Materials: A Detailed Guide Whether you’re building a house, a commercial space, or an infrastructure project, materials like cement, bricks, steel, and tiles make up a major portion of the budget. Understanding the applicable building materials HSN code and GST rate helps builders, contractors, and buyers estimate project costs and manage taxes better. ## Why GST on Construction Materials Matters Before GST, building materials were taxed under various state VATs and central excise duties. The introduction of GST brought uniform tax rates across India. While it simplified the process, it also raised the tax burden on some materials. Let’s explore the **construction material gst rate** category by category. **Get a Free Demo of –** [Real Estate Accounting & Billing Software](https://busy.in/accounting-software/real-estate/) ## New GST Rate on Common Building Materials in India GST on construction materials in India varies depending on the material type and its HSN classification. Building materials fall across different GST slabs, such as 5% and 18%. After the GST updates effective from 22 Sep 2025, most building material GST rates remain unchanged. ## GST Rate Comparison for Common Building Materials | Material | HSN Code | New GST Rate | | --- | --- | --- | | Cement (all types) | 2523 | 18% | | Bricks (non-baked) | 6901 | 5% | | Fly ash bricks | 6815 | 5% | | Sand (natural or manufactured) | 2505 | 5% | | Steel (TMT bars, rods) | 7214 | 18% | | Iron and steel | 7206–7215 | 18% | | Wood (raw) | 4401 | 5% | | Tiles (ceramic, vitrified) | 6907 | 18% | | Paint | 3208 | 18% | | Electrical wiring & switches | 8536 | 18% | | Pipes (PVC, CPVC) | 3917 | 18% | | Sanitaryware | 6910 | 18% | | Glass sheets | 7004 | 18% | Live Demo Available Today ## Track Material Purchases Across Multiple Sites with One Login Trusted by 6,00,000+ Users 4.6 Google Rating \* No credit card required ## **GST Impact on Construction Cost** Construction costs are strongly influenced by the GST rates applicable to key building materials. Materials such as cement and paint fall under the 18% GST slab, making them significant cost drivers in construction projects. Basic materials like bricks, sand, and fly ash are taxed at 5%, which helps keep foundational construction inputs relatively affordable. Several commonly used materials such as steel, tiles, sanitaryware, pipes, wiring, and fittings fall under the 18% GST slab, forming a large share of total construction expenditure. Understanding these slab differences helps builders, contractors, and homebuyers estimate construction budgets more accurately. **Get a Free Trial –** [Best Accounting Software For Small Business](https://busy.in/accounting-software/) ## **How to Calculate GST on Building Materials** GST on construction materials is calculated on the taxable value of the goods purchased. **Here is the Formula** GST Amount = Material Value × GST Rate ÷ 100 Total Price = Material Value + GST Amount ### **Example 1** Cement price: Rs 400 per bag GST rate: 28% GST = 400 × 28 ÷ 100 = Rs 112 Final price = Rs 512 ### **Example 2** Steel rods worth: Rs 50,000 GST rate: 18% GST = 50,000 × 18 ÷ 100 = Rs 9,000 Final price = Rs 59,000 ## **Input Tax Credit for Builders** Builders and contractors registered under GST can claim [Input Tax Credit (ITC)](https://busy.in/gst/what-expenses-can-be-claimed-as-itc/) on the GST paid for construction materials. However, if the construction is for personal use or for selling as completed property, ITC is not allowed under certain rules. So, the benefit of ITC depends on: - GST rate opted by builder - Type of construction (residential vs commercial) - Stage of completion and sale **Get a Free Trial –** [Best GST Accounting Software For Small Business](https://busy.in/accounting-software/gst-accounting/) ## **Tips for Buyers and Contractors** - Always check the GST rate on materials before placing bulk orders - Get GST-compliant invoices from suppliers - Verify that suppliers have valid GST numbers - Use proper HSN codes in billing to avoid classification errors ## **Conclusion** Understanding the correct **gst for construction materials** helps in budgeting, pricing, and compliance. Whether you’re building a home or managing a large project, knowing the **construction material gst rate** ensures better financial planning. ## About the author **Jagdish Prasad** Jagdish Prasad is a Chartered Accountant with over 5 years of experience. He helps people and businesses with GST, income tax, and HSN codes. Jagdish makes sure his clients follow all tax rules and save money the right way. He also enjoys writing simple articles to help others understand taxes and stay updated with the latest rules. ## Frequently asked questions ### What is the GST rate on cement in India? Cement attracts 18% GST under HSN code 2523. ### What is the GST rate on bricks and sand? Most bricks and sand used in construction are subject to 5% GST. ### What is the GST rate on tiles and sanitaryware? Tiles, sanitaryware, and bathroom fittings generally attract 18% GST. ### Can builders claim ITC on construction materials? ITC may be available for eligible business uses of construction materials, subject to GST provisions. ### Does GST apply to materials bought for personal house construction? Yes. 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