A big relief for the real estate buyers as they now don’t require to pay GST on completely constructed buildings only those have issued the completion certification at the time of sale said Finance Ministry. The Finance Minister, Arun Jaitley made the announcement that GST will not be applicable on buyers of real estate properties those have issued the completion certificate at the time of sale. Now, the government levies the Good and Services Tax (GST) on the sale of under- constructions property or ready to move in flats when the completion certificate is not being issued by the buyer at the time of sale.
The Finance Ministry also stated that to builders to decrease the price of properties by providing the benefit of lower GST rate.
Finance Ministry said in a press statement, “It is brought to the notice of buyers of constructed property that there is no GST on the sale of a complex/ building and ready to move in flats where the sale takes place after an issue of completion certificate by the competent authority.” He further stated that affordable housing projects namely Jawaharlal Nehru National Urban Renewal Mission, Rajiv Awas Yojana, Pradhan Mantri Awas Yojana or any other housing scheme owned by the state governments are levying GST at the rate of 8 percent. It can be further adjusted by the real estate builders in the form of Input Tax Credit (ITC).
“For such (affordable housing) projects, after offsetting ITC, the builder or developer in most cases will not be required to pay GST in cash as the builder would have enough ITC in his books of account to pay the output GST,” said Arun Jaitley. He further said that the value of flats, complexes, projects have not enhanced except the affordable segment due to the introduction of the GST regime.
