GOM Favors to 3% For Affordable Housing And 5% For Under Construction Houses GST Rate - GST NEWS
The Group of Ministers (GOM) constituted by the Council of Goods and Services Tax (GST) is in favor of reducing the tax rate from 12% to 5% on the houses of under construction projects. The group favors keeping the GST rate down to 3% on the under construction houses with respect to the projects of affordable housing.The GST Council had formed a ministerial group under the chairmanship of Deputy Chief Minister Nitin Patel last month to find out the difficulties or challenges of real estate sector and review the tax rates. In its first meeting, the group has taken the favor of reducing GST from 8% to 3% on affordable housing.
Officials said that the Group of Ministers (GOM) will finalize its report within a week and will keep it in the next meeting of the GST Council. An official said, "The group is in favor of reducing the GST rates on residential homes by 5% without lowering the input tax credit and reducing the rate at affordable housing to 3%."
GST is currently installed at the rate of 12% on the payment of the under construction properties and such ready flat, where the certificates of completion are not given at the time of sale. Such property was taxed at the rate of 15 to 18% before the GST was implemented.
Such real estate property for which the certificates regarding the completion of the work have been issued, the GST is not imposed on their buyers. Complaints have been received that after the GST is implemented, the builders are not giving the benefit of input tax credit by reducing the price of properties. Other ministers included in this ministerial group include Maharashtra Finance Minister of Maharashtra, Karnataka, Kerala, Punjab and Uttar Pradesh, and Goa's Panchayat Minister Mauvin Godinho.
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