GST dropped from 12% to 5% on Under-Construction Houses
By Realty Quarter Bureau
Buying a House has become a nightmare especially for neo-middle & middle-class people. But, it looks like things are going to be changed.
As per the latest news, The Goods and Service Tax (GST) are going to be slashed from 12% to 5% on under construction houses. The new rate will be effective from April 1st as the centre and states have decided to apply some detailed rules and are expressed to imply a rule of getting inputs and capital goods to be purchased from vendors who are registered to pay GST.
The rule is focused upon to safeguard from sector ridden with cash transactions and black money. Lately, a special rate of 1% was introduced for affordable homes but was withdrawn as it was visible that the builders were trying to get the benefit of the tax credit on inputs such as steel, cement, and paint.
This is going to step-up & encourage all people who are aspiring to get their house and so as will be helpful for real-estate.
The GST council rule will benefit buyers who are currently on construction-linked payment schemes but not those who have paid 95% of the amount.
Tax consultant says “There is a need to keep an eye on the price as there are chance builders would like to cushion and hike the price to match up with the blow of withdrawal of input tax credit”.
The decision for a small portion of commercial space in residential complexes will also get the benefit or not will be done on March 10.
By Abhay Harish Shah