The GST Council's September 2025 reforms — sometimes called the September 2025 GST reforms — delivered the most significant tax relief for homebuilders in seven years. Cement, the single largest material cost in any construction project, had its tax rate slashed from 28% to 18%, effective September 22, 2025.
⚠️ Verify against the official GST Council notification before making procurement decisions. Rates may have changed. GST Council ↗
Understanding these changes is essential for anyone planning to build or renovate a home in 2026.
Cement alone contributes 12–18% of total construction cost. A 10-percentage-point reduction in GST on cement directly reduces your material bill. On a ₹50 lakh construction project, savings are ₹75,000–1.5 lakh depending on the cement intensity of your design.
| Material | HSN Code | Old GST | GST 2026 | Change |
|---|---|---|---|---|
| Cement (all types — OPC, PPC, PSC) | 2523 | 28% | 18% | ↓ 10pp |
| TMT Steel bars / rods | 7213, 7214 | 18% | 18% | — |
| Flat-rolled steel products | 7208–7212 | 18% | 18% | — |
| Aluminium sections / sheets | 7604 | 18% | 18% | — |
| Clay bricks & fly ash bricks* | 6901, 6904, 6815 | 12% | 12% | — |
| AAC blocks (with fly ash, most brands)* | 6815 | 12% | 12% | — |
| Ready-mix concrete (RMC) | 6810 / 3824 | 28% | 18% | ↓ 10pp |
| Roofing tiles (clay / earthen) | 6905 | 12% | 12% | — |
| Ceramic / vitrified floor tiles | 6907 | 18% | 18% | — |
| Marble & granite blocks (raw) | 2515 | 12% | 5% | ↓ 7pp |
| Granite / marble finished slabs | 6802 | 28% | 18% | ↓ 10pp |
| River sand & M-sand | 2505 | 5% | 5% | — |
| Crushed stone / aggregate | 2517 | 5% | 5% | — |
| Ready-mix concrete (RMC) | 3824 | 18% | 18% | — |
| Copper wiring (electrical) | 7408 | 18% | 18% | — |
| CPVC / PVC pipes | 3917 | 18% | 18% | — |
| Sanitary ware (WC, basins) | 6910 | 18% | 18% | — |
| Paints & surface coatings | 3208 | 18% | 18% | — |
| Glass (plain / toughened) | 7005 | 18% | 18% | — |
| Plywood / MDF (furniture) | 4412 | 18% | 18% | — |
| AAC blocks (Autoclaved Aerated Concrete) | 6810 | 12% | 12% | — |
| GFRG panels (new technology) | 6811 | 12% | 12% | — |
* Brick suppliers can opt for a 6% rate without Input Tax Credit under the special brick-kiln composition scheme. Ask your supplier which scheme they bill under — it changes your invoice.
Because they are quoting a rate that ended in April 2022, when GST on building and fly ash bricks was raised from 5% to 12% (with a 6%-without-ITC option). The September 2025 GST reforms did not cut bricks back to 5% — CBIC Notification No. 14/2025-Central Tax (Rate), dated 17 September 2025 and effective 22 September 2025, re-notified 12% (6% CGST + 6% SGST) on fly ash bricks and blocks, building bricks, bricks of fossil meals, and earthen roofing tiles. Several high-traffic tax blogs contradict themselves on this. If your contractor or supplier bills bricks at 5%, the invoice is using a dead rate — verify the HSN code and scheme.
The rates below repeat the table above in plain-answer form, one material at a time — verified against CBIC Notification No. 14/2025 and the post-September-2025 rate schedule.
The GST rate on bricks in 2026 is 12% with input tax credit, or 6% under the composition-style option without ITC. This covers regular fired clay bricks (HSN 6901) and fly ash bricks alike — the special brick regime introduced in April 2022 continues unchanged through 2026. For a self-builder buying with a GST invoice, the 12%-with-ITC route only helps if your contractor is registered and passing credit through; most retail purchases effectively price at the 6% no-ITC rate built into the quoted price.
The GST rate on cement in 2026 is 18%, cut from the long-standing 28% in the September 2025 rate rationalisation. On a ₹380/bag street price, roughly ₹58 is GST — and the 10-point cut is the single biggest reason per-bag prices softened between 2025 and 2026. All cement types (OPC, PPC, white) carry the same 18%.
AAC blocks with more than 50% fly ash content (HSN 6815) attract 12% GST in 2026 — the standard classification for mainstream AAC brands. Cement/concrete blocks without fly ash fall under HSN 6810 at 18%, so the fly-ash question decides your rate: ask the dealer for the HSN code on the invoice, not just the brand name.
Ready-mix concrete attracts 18% GST in 2026. Because RMC is invoiced formally by batching plants, the tax is always visible on the bill — unlike site-mixed concrete where GST rides inside material line items. If your contractor is GST-registered, the 18% on RMC is creditable against their works-contract output tax; on labour-only contracts where you buy RMC directly, it is simply part of your cost.
Let's calculate the real-world impact on a standard 1,200 sqft house at ₹2,000/sqft (standard quality, metro city):
| Cost Head | % of Project | Cost Before GST Cut | Cost After GST Cut | Savings |
|---|---|---|---|---|
| Cement (25 bags per 100 sqft, ₹380/bag) | 14% | ₹3,36,000 | ₹3,03,280 | ₹32,720 |
| Bricks (1,200 pieces per 100 sqft) | 8% | ₹1,92,000 | ₹1,92,000 | — (12% unchanged) |
| Steel, aggregate, other | 28% | ₹6,72,000 | ₹6,72,000 | — |
| Labour, overheads (no GST change) | 50% | ₹12,00,000 | ₹12,00,000 | — |
| Total (1,200 sqft × ₹2,000) | 100% | ₹24,00,000 | ₹23,67,280 | ~₹32,720 |
On a ₹24 lakh project, the savings come to approximately ₹33,000 — or ₹27/sqft, almost entirely from the cement rate cut. Larger projects see proportionally higher savings.
If you're buying rather than building, the GST structure works differently:
| Property Type | GST Rate | Notes |
|---|---|---|
| Under-construction flat (general) | 5% | On the sale value excluding land (⅓ land deduction allowed) |
| Affordable housing (under ₹45L, carpet ≤60 sqm metro / ≤90 sqm others) | 1% | No ITC available to builder |
| Ready-to-move flat (with OC) | Nil | Only stamp duty + registration applies |
| Commercial property | 18% | On full sale value minus land |
A ready-to-move flat with an Occupancy Certificate (OC) attracts zero GST — only stamp duty and registration apply. On a ₹80 lakh flat, this saves ₹4 lakh vs an under-construction unit at 5% GST. Factor this into your buy vs build decision.
If you hire a contractor for construction (works contract), GST applies differently:
For the full FY 2026-27 cost picture beyond GST — including steel prices, labour code impacts, and optimal timing — see our FY 2026-27 construction cost outlook. Labour costs have also risen significantly — see our analysis of the new labour code impact on construction costs.
Cement GST is 18% in 2026, reduced from 28% effective September 22, 2025, under the September 2025 GST reforms. This applies to all cement types — OPC, PPC, Portland Slag Cement. The HSN code is 2523. This 10-percentage-point reduction is the most significant relief for the construction sector in years.
TMT steel bars and rods attract 18% GST under HSN 7213/7214 — unchanged from before. Unlike cement, steel saw no GST rate reduction. However, GST-registered contractors can claim ITC on steel purchases, which partially reduces the effective cost impact on homeowners through competitive pricing.
Approximately ₹15,000–28,000 on a 1,000 sqft standard quality home, translating to ₹15–28/sqft. The savings come almost entirely from cement (28% → 18%) — brick rates were unchanged at 12%. Total project cost reduction is 1.5–2%, depending on cement intensity of the design.
Yes. Under-construction flat purchases attract 5% GST (1% for affordable housing under ₹45 lakh with carpet area up to 60 sqm in metros). This applies to the sale value after deducting ⅓ for the land component. Ready-to-move flats with an Occupancy Certificate are completely GST-exempt — only stamp duty and registration apply.
Individual homeowners building their own residence cannot claim GST input tax credit (ITC) — ITC is only for GST-registered businesses. However, your contractor (if registered) can claim ITC on materials and should ideally pass this benefit to you through competitive pricing. Always ask for an itemised GST invoice.
Clay bricks and fly ash bricks are at 12% GST with ITC in 2026 (or 6% without ITC under the brick-kiln composition option), per CBIC Notification No. 14/2025-Central Tax (Rate) effective 22 September 2025 — unchanged by the September 2025 reforms. Earthen roofing tiles are also 12%. Ceramic and vitrified floor tiles remain at 18%. Granite/marble finished slabs moved from 28% to 18%.
Fly ash bricks and blocks attract 12% GST (6% CGST + 6% SGST) with ITC, per CBIC Notification No. 14/2025-Central Tax (Rate) dated 17 September 2025, effective 22 September 2025. Suppliers who opt out of ITC can bill at 6% under the special composition scheme. Several websites still show 5% — that rate ended in April 2022 when the brick-kiln sector moved to the 12%/6% structure.
AAC blocks made with fly ash — which covers most Indian AAC brands (Aerocon, Biltech, Magicrete, etc.) — fall under HSN 6815 and attract 12% GST. Pure cement/concrete blocks without fly ash fall under HSN 6810 at 18%. Check the HSN code on your supplier invoice; the 6-point difference matters on a full-house order.
Ready-mix concrete attracts 18% GST in 2026 (HSN 6810/3824), reduced from 28% by the September 2025 reforms. If your contractor mixes concrete on site instead, there is no separate GST on the mix — you pay GST on the inputs individually: cement 18%, sand and aggregate 5%. On large pours, site-mix can carry a lower effective tax burden, though RMC wins on quality consistency.
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GST rates on this page are sourced directly from official GST Council notifications and CBIC circulars.
CBIC Notification No. 14/2025-Central Tax (Rate) dated 17 September 2025, effective 22 September 2025 — the operative notification for brick and tile rates (12% / 6% without ITC) — alongside the September 2025 rate rationalisation on cement and other materials.
cbic-gst.gov.in ↗JLL's March 2026 report on construction cost trends, material price movements, and regulatory impact (the September 2025 GST reforms + New Labour Code) on residential construction in India.
jll.co.in ↗National Buildings Organisation city-wise residential construction cost benchmarks used to calculate material consumption rates per sqft at different quality grades.
nbo.nic.in ↗Cement Manufacturers Association of India price data for ex-plant and dealer pricing across metros and Tier-2 cities, Q3 2026.
cmaindia.org ↗