The Government of Bihar on January 22, 2024, issued a notification regarding determining the procedure for payment related to work contracts under the state government in the context of an increase in GST rate for the construction work category (ie 18% instead of 12%).
After due consideration, the proposal to determine the procedure for implementation and payment of construction works under the State Government is as follows:-
•The effective increase in the contract price of construction works due to the GST rate applicable from July 18, 2022, (18%) will be calculated.
•In work schemes in which the estimate is approved based on 12% GST and payment has been claimed by submitting the bills against the work done on or after July 18, 2022, an additional amount is based on 18% GST. Will be included. But dated July 18, 2022, Payment of the billed amount before 2022 will be estimated based on 12% GST.
•Approval of all new schemes from date July 18, 2022, will be based on 18% GST.
•The additional amount added to the project cost due to the said increased rate in GST will be considered outside the scope of requirement of revised administrative approval.
[Notification No. 4-10/2023/674]
