No GST on property rented out for personal use: Govt

New Delhi: The government on Friday said GST will not be applicable on residential units if they are rented out to private persons for personal use.

The government dismissed media reports which claimed that there is an 18 per cent Goods and Services Tax (GST) on house rent paid by tenants.

In a tweet, the government said GST would be levied only when the residential unit is rented out to a business entity.

"No GST when it is rented to private person for personal use. No GST even if proprietor or partner of firm rents residence for personal use," it said.

Earlier, Congress had claimed that an 18 per cent GST was applied on rent for residential property and called it "asli kaala jaadu".

The 'kaala jaadu' dig was in apparent reference to Prime Minister Narendra Modi's criticism of the Congress for wearing black dresses on August 5 in protest against price rise. Modi had said those who believe in "kaala jaadu" will never be able to win the trust of the people again. In a tweet, Delhi Congress vice-president Mudit Agarwal said 18 per cent GST on rent even for residential property is an example of 'acche din' by the Modi government.

Tagging Agarwal's tweet, Congress general secretary Jairam Ramesh said after "senseless GST on food items of daily consumption now this. This is asli kaala jaadu".