Government to discuss bringing real estate under GST on Jan 18
The issue of bringing real estate under the GST's ambit will be discussed in the next meeting of the GST Council to be held on January 18.
The meeting holds special significance as it is the last time the council will meet ahead of the Union Budget, to be presented on February 1.
"Discussion of real estate inclusion in GST is the key agenda of the GST Council which is scheduled to meet on January 18th," a senior government official told ANI privy to the deliberations.
He further added that the GST Council in all likelihood will not reach a decision on this, but a serious discussion is expected nonetheless.
The states like Delhi and Jammu Kashmir are very keen to bring real estate sector under the GST ambit.
Meanwhile, severely impacted by various reforms like RERA, GST and demonetisation, the realty sector is pinning its hopes on Budget 2018-19 for relief measures like lower taxes and infrastructure status.
Industry players are expecting rationalisation of the GST rates from the current 12 per cent to 6 per cent and bringing stamp duty under the ambit of GST.
"Also, industry status to the full real estate sector will help in creating surplus housing demand along with financing at a lower rate for long-term projects.
"Rationalisation of GST by capping it at 6 per cent with input tax credit for the entire segment in real estate will help revive and boost demand," Naredco National President Niranjan Hiranandani said.
During the pre-GST era, service tax was around 4.5 per cent and VAT 1 per cent -- resulting in total tax outgo of 5.5 per cent.
Earlier in November, Finance Ministry officials chaired a meeting with real estate developers over GST to be levied on properties owned by private developers.
According to the sources, more than one dozen issues are on agenda for the meeting on January 18.
The official added that the GST Council is likely to give a nod to rationalisation of rates on five-six items. These items are related to equipment which are used in agriculture.
OneIndia News (with agency inputs)