The GST Council is set to address the contentious issue of 18% GST on development rights in land deals, which could lead to a reduction in property prices.
The crucial GST Council meeting is scheduled for September 9, with a potential announcement that might ease the current tax burden on real estate transactions.
Key Developments and Upcoming Decisions
The Group of Ministers (GoM) on real estate will meet on August 22 to discuss the impact of the 18% GST on development rights, a tax that has been a point of contention for developers.
The tax is applied during the purchase and sale of land, increasing the overall cost of property. This additional cost is often passed on to home buyers, making flats and houses more expensive.
Currently, GST is not applied to the purchase and sale of developable land. However, the imposition of 18% GST on development rights has led to higher property costs.
Developers and landowners have been protesting this tax, arguing that it unnecessarily inflates the price of real estate.
Impact and Future Prospects
The GoM’s recommendations on this issue could significantly influence the outcome of the GST Council meeting.
A decision in favor of easing or removing the GST on development rights could alleviate the financial strain on home buyers and potentially reduce property prices.
The resolution of this matter is keenly awaited by both the real estate sector and prospective homeowners.
