Anuj Puri, Chairman – ANAROCK Property Consultants
The applicability of GST in the Indian taxation system was a move aimed towards ‘one nation, one tax’.
Post land abetment, the applicable GST for under-construction properties was 12% while ready-to-move-in flats were kept out of the GST ambit.
Even for under-construction properties, there was a ruling of Input Tax Credit (ITC) pass-over to the buyer to ensure that it becomes a tax neutral proposition.
While calculations and ITC pass-over still remain a challenge after 1.5 years of GST regime, a recent announcement stated that there is no GST applicable only on ready-to-move-in flats wherein sales took place after the issue of completion certificate.
This is likely to add woes to buyers as well as developers.
Until now, all properties that were treated as ready-to-move-in were out of GST ambit, so buyers had significant choices.
As per ANAROCK data, more than 90,000 units out of total unsold inventory of 6.87 lakh units (as of Q3 2018) across the top 7 cities were ready-to-move-in – a massive 14% of the overall unsold stock.
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