New Delhi, February 26, 2019: “The decision by the GST council to reduce the GST to 5% for under-construction properties is an extremely welcome step. It means a direct saving of 7% on the total unit price for the consumers, which is very significant. It will certainly lift up customer sentiments and sales is expected to grow significantly. Since there is no ITC, the benefit would be roughly pegged around 5% instead of 7%. Moreover, capping of GST at 1% for affordable housing will surely boost sales in non-urban, tier 2 and tier 3 cities. Put together, it is a significant step in giving the much needed boost to the real estate sector.
However, cement remains the highest taxed input for construction hence it would be further beneficial if the GST council reduces the rate on cement, which is currently at 28%. Furthermore, cost of other elements needed for construction could also be controlled so that the input credit is reduced.”
Corporate Comm India(CCI Newswire)