No, Government didn’t impose 18% GST on house rents

Claim: 18% GST on house rent

A post is viral across social media platforms claiming that the central government has imposed 18% GST on rents hinting at the increase in overall expenses on accommodation.

Saket Gokhale, the national spokesperson of All India Trinamool Congress (AITC), wrote on Twitter, “Attention: Your house rent will now go up by 18%. Why? Because the Modi govt will now be charging GST to tenants on their house rent.”

“Amidst a massive price rise, the cruel money-grabbing Modi govt is determined to squeeze every penny out of the pockets of ordinary Indians”, he added.

Gokhale further added to his tweet saying, “The “registered tenant” clause is clever word magic. It means EVERY freelancer, artist, writer, doctor, lawyer, and others who aren’t full-time employed & don’t have an office. If your main office is also your home, you’re covered under this.”

Gokhale also pinned a screenshot of an NDTV article that reads, “GST (tax) on rentals? Registered tenants to pay 18% tax on house rents.”

Claim: GST imposed on rents

Source: Saket Gokhale/Twitter

Another tweeter user Dr. Shama Mohamed also claimed that 18% GST would be imposed for renting residential property.

He wrote on Twitter, “People will now be taxed at 18% for renting residential property. People who cannot afford their own homes will now be punished for staying on rent. After High fuel excise & inflated food prices & now GST on rent, will the common man be able to save anything for his future!”.

Claim: GST imposed on rents

Source: Dr Shama Mohamed/Twitter

“Modi promised in 2018 – Every Indian will have a house by 2022. Modi delivered in 2022 – 18% GST on house rent“, claimed another social media user.

Claim: GST imposed on rents

Source: Sanghamitra/Twitter

FactO Check:

After seeing multiple claims about 18% GST on rent, we went through multiple reports related to recent GST rules.

We found that GST is applicable when the property is rented to the business entity, according to the Press Information Bureau (PIB). The PIB further said, “No GST when it is rented to a private person for personal use. And No GST even if the proprietor or partner of the firm rents residence for personal use.”

As stated above, not every landlord is required to pay the tax. Residential properties would be subject to GST under the new government’s regulations if they are leased or rented by a GST-registered person or company.

Given that most of the salaried classes are not enrolled on the GST network, they would be exempted from paying GST.

The annual threshold limit for GST registration has been set at Rs. 20 lakhs for service providers and Rs. 40 lakhs for suppliers of products by the Narendra Modi administration.

Who will pay GST?

According to the rule, salaried individuals paying rent for residential units won’t pay any GST. However, if a GST-registered individual leases a home or apartment and uses it for business purposes, only then they are entitled to pay 18% GST on the rent given to the owner.

The tenant won’t be subject to the tax laws if both the landlord and the tenant are not registered under GST. Additionally, the transaction will not have a GST clause if the landlord is GST registered but the tenant is not on the list.


Hence, the claims of GST on rents are misleading and ill-informed and are shared in a bid to attack the government for overburdening the salaried class people with rents.



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About the author

Kaleem Ullah Fasihi

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