RWAs oppose 18% GST on maintenance charges, seek rollback from Centre

Resident welfare associations have opposed the 18% GST on maintenance charges announced by Nirmala Sitharaman, warning of increased costs for residents. RWAs are planning a nationwide campaign seeking exemption, despite the government clarifying applicability thresholds.

Hyderabad: The Union Finance Minister Nirmala Sitharaman’s announcement to impose 18% Goods and Services Tax (GST) on maintenance charges of residential apartment associations, if their turnover exceeded Rs 20 lakh, has become a debate point among resident welfare associations (RWAs) in the city.

More than 4,500 registered RWAs working under the United Federation of RWAs (U-FERWAS) have demanded the Finance Minister roll back the announced GST.

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The RWAs collect maintenance charges from flat owners to maintain basic amenities such as sanitation, security, water tankers, lift maintenance, and other amenities. The range of the maintenance charges starts from Rs 2,500 per month per flat and goes up based on the apartment complex or gated community.

For this, RWAs maintain a separate account to deposit the monthly maintenance charges and spend them as per requirement for the apartments. Even gated communities also follow a similar procedure.

Joint secretary, Confederation of RWAs, K Raghavendra Rao said, “Collecting 18% GST will become an additional burden on middle-class families. Then, the RWAs concerned have to increase monthly maintenance charges at least to 40% to 60% on each flat/Villa. At this juncture, nobody is willing to accept the increased maintenance charges.”

The RWAs have taken up a signature campaign, which is getting extended across the country. They also plan to meet Union Finance Minister Nirmala Sitharaman, and GST Council and make an appeal seeking an exemption for RWAs in 18 % GST, he said.

Nirmala Sitharaman had said that the 18% GST on maintenance charges applies only when the amount exceeds Rs 7,500 per member per month and the RWA annual turnover exceeds Rs 20 lakhs. No GST is applicable if the monthly charges are Rs 7,500 or less.