New Delhi, Feb 24: In a major relief to homebuyers and the real estate sector, the Goods and Services Tax (GST) Council on Sunday cleared the proposal for lowering the GST rates for real estate.
The GST council slashed tax rates on under-construction housing properties to 5 per cent without the input tax credit, from the existing 12 per cent, Finance Minister Arun Jaitley said. The Council also cut GST rates on affordable housing to 1 per cent from the current 8 per cent and expanded the scope of affordable housing to those costing up to Rs 45 lakh and measuring 60 sq metre in metros and 90 sq metre in non-metro cities. "This will be a major step in our efforts to give 'boom' to the real estate sector and making housing affordable for the middle class, neo-middle class, and aspirational class," Finance Minister Arun Jaitley said while briefing the reporters after the GST Council meet. The new tax rates will come into effect from April 1, 2019.