GST for real estate sector

202 views 7 replies

Abhijeet Chaudhari

20 Points Joined September 2017

Hi,

As known till date, GST on contruction service in real estate for redential building, is effective 12% (18% on 2/3rd value) if I am not wrong.

As compared to previous ST and MVAT, that was 5.5%, 12% is much higher rate. It is more than double amount needa to be paid as previous tax. Is it supposed to be worked like this? As it seems to costly now to buy under construction house.

Thanks,
Abhijeet

Replies (7)

Dhirajlal Rambhia

SEO Sai Gr. Hosp.

208800 Points Joined July 2016

As such it is different way of calculation........ earlier VAT & ST were charged over under construction properties, plus excise & VAT was charged over raw material like cement, steel etc.... this was not known to customers, but added to the cost of flats by builders.....

Under GST these all taxes are replaced by GST with ITC (input tax credit at each stage).... which means the overall effect would be positive to end consumers.

Only thing is the benefits should come to end consumer by reduction in price of the flat, but that may take some more time.......... may be worked out in new projects....

RAJA P M

"Do the Right Thing...!!!"

128116 Points Joined January 2015

Yes. I agrred to My dear Dhirajlal Sir...

It's take some more time as GST benefits to End users. Also We can wait.

Bcoz, Really GST is helpful...

Abhijeet Chaudhari

20 Points Joined September 2017

Ok, fair enough to understand. Thank you very much.

Abhijeet Chaudhari

20 Points Joined September 2017

Ok, fair enough to understand. Thank you very much.

Dhirajlal Rambhia

SEO Sai Gr. Hosp.

208800 Points Joined July 2016

My Pleasure.....

Saji Daniel

2 Points Joined August 2015

I agree. However, I have booked a flat in 2013 and final one installement is pending,now he is charging 12% on balance amount. How it can be justified?. Kindly let me know the remady on tyhis issue... Thankss....

Abhijeet Chaudhari

20 Points Joined September 2017

So finally construction of the building is completed and possession is done, and GST benefits are calculated as zero, finally ended up paying 130000 extra as per GST rates. When discussed with builder, all calculations are properly done......