NEW DELHI: In GST 33rd meeting tomorrow, As the then interim finance minister Piyush Goyal had indicated in his budget speech, the GST Council, may cut GST rates on under-construction residential properties. At present, 12% GST is levied with input tax credit (ITC) on payments made for under-construction property or ready-to-move-in flats where completion certificate has not been issued at the time of sale.
According to Source report, the GST rate on such properties may be reduced to 5% without ITC while in the affordable housing segment the GST rate can be slashed to 3%, from 8%. The effective pre-GST tax incidence in the affordable housing category is 15-18%. GST, however, is not levied on buyers of real estate properties for which completion certificate has been issued at the time of sale.
Piyush Goyal, who was handling the finance ministry then, had said in his budget speech “Our Government wants the GST burden on home buyers to be reduced and accordingly we have moved the GST Council to appoint a Group of Ministers to examine and make recommendations in this regard at the earliest,".
also read Lending rates can't come down unless deposit rates brought down: CEO, HDFC Bank
However, there have been complaints that builders are not passing on the ITC benefit to consumers by way of reduction in price of the property after the rollout of GST, following which the GST Council had set up a ministerial panel to suggest ways to boost the realty sector.
A state ministerial panel set up to review the tax rate on lottery has favoured a uniform GST rate of either 18% or 28%, PTI reported. Currently, a state-organised lottery attracts 12% GST while a state-authorised lottery attracts 28% tax.
also read For not filling Income tax arrears and interest, a businessman jailed