Brick kilns can opt for a composition scheme to pay a 6 per cent GST without input tax credit (ITC) beginning Friday, higher than 5 per cent earlier.

Those businesses who do not wish to opt for the composition scheme would be subject to 12 per cent Goods and Services Tax (GST) with ITC.

The government on March 31 notified the GST rates that would be applicable from April 1.

As per the notification, building bricks, earthen or roofing tiles, fly ash bricks and blocks, bricks of fossil meals can opt for a composition scheme.

So far, manufacturing and trading of bricks were chargeable at 5 per cent GST, and businesses were allowed to claim credit on inputs.

The GST Council had in September last year decided to bring brick kilns under a special composition scheme from April 1, 2022.

AMRG & Associates Senior Partner Rajat Mohan said India is already witnessing high inflation and at this juncture, any steep increase in tax rates for essential infrastructure items would lead to a ripple effect across the housing and infrastructure sector.

"Developers of residential housing are not permitted to avail any ITC. Thereby such sharp increase in the tax rate for bricks would also lead to cascading effect in the entire residential housing sector, pinching the pocket of consumers," Mohan added.