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Explainers

GST On Rent, Burials To Public Toilets: False Claims That Went Viral

Misinterpretation and misreporting of the decision taken by the 47th GST Council has led to a slew of government denials

By - Mohammed Kudrati | 24 Aug 2022 11:44 AM GMT

Ever since the 47th GST Council announced changes in GST rates and addition of new services under the regime, a lot of false claims have gone viral on social media. These false claims ranged from imposition of GST on residential rent to the usage of public toilets and even cremating the dead.

These latest changes in the Goods and Services Tax (GST) regime were made in June and have taken effect on July 18. The changes have faced flak, as they deal with everyday consumer goods such as pre-packaged and pre-labelled food items and on hospital bills. 

The false claims regarding several changes in the GST rates also forced Finance Minister Nirmala Sitharaman to clarify the government's stand in her speech on August 1 during the recently concluded Monsoon Session of Parliament. 

In the latest such clarification, the government had to clarify that no charges would be imposed on UPI (Unified Payments Interface) transactions; a popular form of payment for everyday cashless and instant transactions carried out through smartphone apps.

Social media went abuzz with speculation that UPI too would be subject to charges (including claims about GST), after the Reserve Bank of India released a policy paper on charges in payment systems was misinterpreted on social media, leading to the government to issue a clarification.

Since July, BOOM has debunked four stories with respect to the changes in the GST regime. 

1. GST on residential rent

The new GST regulations stipulate that tenants who were GST-registered themselves would now have to pay GST at the rate of 18% if they paying residential rent. This covers firms, businesses and persons who were registered under the GST. It was initially tweeted by Saket Gokhale, a leader of the Trinamool Congress, followed by other users claiming on social media.

Before this change, the residential rent paid by GST-registered tenants was exempted. 

However, this regulation was made to show on social media as a blanket imposition of GST on residential rent, and that the salaried individuals too would need to pay GST on the residential rent paid by them towards their housing. The salaried are not required to register under the GST. 

BOOM found that this claim was misleading, as the GST on residential rent was only applicable to a targeted group and was not a blanket imposition. Further, such rent could be claimed by those paying them, as an input tax credit. The government took to social media to deny the claim in a simple social media post as well. 

Also Read: Do You Have To Pay 18% GST On House Rent? A FactCheck

2. No escape from GST even after death?

In a superlative claim mixed with rhetoric, several users on social media claimed that one has no respite from GST even after death as services provided by burial grounds and crematoriums to the dead were also taxable at 18%. 

Under the new rules, the government increased the rate of GST imposed - from 12% to 18% - on contractual work on several infrastructural projects, including roads, bridges, effluent plants, metros that also included crematoriums. 

However, BOOM found from the GST Act, 2017 that the funeral or last rite services provided by crematorium, mortuaries, burial ground or even transportation of the deceased would not considered to be a good or a service for taxation under the GST. Here too, the government had to clarify the imposition on social media. 

In fact, this clarification even found a place in Sitharaman's speech to Lok Sabha on August 1. 

Also Read: Claims Of 18% GST On Crematorium Services Are Misleading; Here's Why

3. GST to use toilets?

A viral claims stated that the government had levied ₹1 GST on the use of public toilets over and above the ₹5 on its usage charge, based on a picture of a payment receipt from a Ludhiana bus station. 

This claim was stemming from a 2017 incident, which went viral as recent, and was debunked by the Ludhiana bus station authorities as fake; stating that the usage of the urinal was free while the usage of the toilet cost ₹2. 

Further, BOOM was able to verify from the GST database of the Central Board of Indirect Taxes and Customs that no GST is imposed on facilities towards public convenience, such as bathroom, public showers and washrooms. 

Also Read: Viral Post Falsely Claims GST Imposed On Use Of Public Toilets

4. Amul advertisement on GST is utterly butterly fake

An advertisement by Amul, featuring its traditional mascot girl, was photoshopped to show it taking a dig at the government over the recent changes in the GST regime. 

As mentioned, the changes affect pre-packaged and pre-labelled consumer goods, including edible dairy products like milk and butter. Amul is the world's largest dairy cooperative. 

The advertisement shows the mascot with an animated version of Prime Minister Narendra Modi and Defence Minister Rajnath Singh with the caption 'Abki Baar GST Ki Maar' (this time, GST will bite), a spin on the Bharatiya Janata Party's election slogan that propelled it to power in 2014. 

BOOM found that picture was posted by Amul on social media on May 16, 2014, to congratulate Modi on receiving an absolute majority in the elections to the 16th Lok Sabha. 

This took place more than three years before the GST regime even came into existence.

Also Read: Amul Ad Targeting Modi Govt On GST? No, It's Utterly Butterly Fake