It is expected that the newly implemented Goods and Services Tax (GST) bring down the prices of real estate projects but it has not happened nearly two months since GST was implemented in the country. The builder did not see that prices reduce under the new tax regime due to plenty of reasons. Real estate sector levies 12 percent GST in the new regime.
Amid home buyers has raised objections that the government was not paying attention to solve their problems and issues. On Monday, Minister of State for Finance, Arjun Ram Meghwal said, “Consumer interest is our highest priority”, he said in the event of a real estate conference which was arranged by the industry body NAREDCO.
He was responding to a question regards ongoing protest by home buyers of Amrapali and Jaypee Group. Arjun Ram Meghwal said that the government is continuously observing the situation and the buyers will be sheltered via Real Estate Regulation Act (RERA) that was passed in 2016 and came into existence in May 2017.
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However, the government aware of the problems being faced by the home buyers in the new tax regime and therefore introduced a new Regulatory Act, (RERA), in 2016, it provides benefits to both, developers as well buyers. The Minister further added that the Insolvency and Bankruptcy code will help in ‘ease of doing business’.
The government is protecting the interest of buyers and consumers via RERA, the Minister said, it will provide benefits to homebuyers in the form of protecting their interest. Meghwal said, “For those developers who have defaulted on the promise and not delivered flats, we are regularly reviewing the situation. Through RERA, we are protecting the interest of home buyers and will provide relief. Be it any developer group, regulators will do its job.”
On buyers side, they thought the government is not addressing their problems, he stated: “Home buyers have met me. I have spoken to the owner of Jaypee Group also. We are in regular touch. We will take care of the interest of consumers.” While addressing the event, the Minister assured he will take some actions that developers are facing related to the new tax regime
“We have an open mind. If there is any tax related issue, I will take up the matter in the GST Council“, Meghwal said.
Rajnish Kumar MD of SBI’s (National Banking Group) commented that there as such there was no clarification in the new tax regime, Meghwal replied to Rajnish Kumar comment, the real estate sector should communicate with us if they face any issues regarding the Goods and Services Tax (GST).
The new indirect tax regime has been introduced for the economic growth of the country in the right direction and has shown confidence that the real estate industry would collect benefits. FY17 would be called as the year of economic reform and several changes have been taken by the government starting from demonetization on 8th November 2016 and implementation of Goods and Services Tax across the country from 1st July.
