GST Council may reduce tax on under-construction houses to 5%
Prabhakar Sinha | TNN | Feb 20, 2019, 05:06 IST
NEW DELHI: The GST Council is expected to reduce GST on under-construction houses to 5% and on affordable ones to 3% without allowing input tax credit, from the existing level of 12% and 8% .
The council in its last meeting formed a group of ministers under the chairmanship of Gujarat deputy CM Nitin Patel to evolve a consensus rate of GST. The panel has submitted the report suggesting a reduction in the levy.
Realtors have been running a campaign suggesting that the proposed move will push up prices of under-construction houses up to 4,000 square feet as the input tax credit will be done away with. It will, however, result in a reduction in the price of super premium houses of over Rs 10,000 per sq ft where the existing effective rates go up to 10%. The tax on these properties under the new regime will come down to 5% leading to reduction in the prices.
The council in its last meeting formed a group of ministers under the chairmanship of Gujarat deputy CM Nitin Patel to evolve a consensus rate of GST. The panel has submitted the report suggesting a reduction in the levy.
Realtors have been running a campaign suggesting that the proposed move will push up prices of under-construction houses up to 4,000 square feet as the input tax credit will be done away with. It will, however, result in a reduction in the price of super premium houses of over Rs 10,000 per sq ft where the existing effective rates go up to 10%. The tax on these properties under the new regime will come down to 5% leading to reduction in the prices.
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