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Jaitley announces GST slash on properties under construction
Posted on: 25/Feb/2019 2:23:03 PM
Arun Jaitley, the Finance Minister, in his latest announcement has stated that for all under-construction housing properties, the tax rates are slashed down to 5 percent waving off the input tax credit. The previous percentage of tax was notably 12%. This is to bring a heave of sigh among the home buyers. On the other hand, the Council has also reduced GST rates for affordable housing from the previous 8 percent to new 1 percent, thus widening the scope to buy affordable houses that fall under the price range Rs 45 lakh and of 60 sq.mt. in metro cities and 90 sq.mt. in non-metro cities.
These revised rates shall come to effect starting from 1st April 2019.
At present, for under-construction properties and ready-to-move flats, the GST levied is 12%. Also, for these properties, at the time of sale, completion certificate will not be issued.
It is also to be noted that the builders will not be able to claim their input tax credit as per the revised GST rates. Jaitely points that the new GST rates shall give a boost in the construction sector.
Note: for properties that have received completion certificate, the aforementioned GST changes will not be applicable.
Considering lotteries, GST Council has in fact deferred with Jaitley decision claiming that one more meeting with the GoM will take place for discussing this proposal. At present, 12 percent GST is implied on all state-run lotteries.
