GST Council to address and approve rules related to under-construction buildings in realty sector
A meeting via video-conferencing is to be held with the GST Council for approving the rules related to under-construction buildings. As per a senior finance ministry official, the meeting will help in attaining a clarity about the grey areas governing the rule.
As a matter of fact, the Goods and Services Tax (GST) rate for under-construction buildings was revised from 12 per cent to 5 per cent and on projects under affordable housing from 8 per cent to 1 per cent, in the last meeting.
But, a number of issues were left unresolved, about which the developers have raised their concerns and asked for clarity. A meeting between the Central Board of Indirect Taxes and Customs (CBIC) and a few real estate sector representatives was held for discussing the grey areas. “The next meeting will explain the issues over which the sector has been seeking explanation. Also, the law committee of the council will approve the rules, which would be effective from April 1,” the official added.
Also, the GST Council will be taking up the issue of relaxation of the 80 per cent mandatory procurement from registered suppliers. “So far, the general consensus is that 80 per cent procurement norm is going to make many dealers GST-compliant. So, the council is unlikely to relax this norm. Also, there is confusion over the rebuilt property. The council largely agrees that rebuilt property must be considered as under-construction property itself. The final call will be taken at the meeting,” he added.