By the government of India, A panel has been made to analyze rates of taxes and to look after what problem is been faced by people who belong to the Real estate industry beneath (Goods and Services Tax ) Gst administration.
The head of this panel is Nitin Patel who is currently deputy Cheif minister of Gujarat under his supervision a group of the minister is been working on this report.
According to this panel, Gst on residential property should be reduced to 5 per cent from 12 per cent and Gst on affordable property been also reduced from 8 percent to 3 per cent.
As per officials, reports by GOM would be finalized within the upcoming weeks and then it will be presented in front of GST council.
Officials said that GOM wants that tax to be reduced on residential property buyer upto 5 percent without input tax credit and 3 percent on the affordable property.
In the current situation, buyers are paying up to 12% of GST with an Input tax credit on the property which is in still construction face.
Flats which is in ready condition properties are not getting a certificate of completion.
There is also an issue that consumer are not been informed about the ITC benefits and even they are not been getting some relief in the price by Developers.
What is ITC (Input Tax credit )?
I stands for Input and TC for Tax credit,
The services and material which a manufacturer buys for making his product which is considered as his output is called Input.
Tax credit means the manufacturer was capable of decreasing his output of tax.
The council of GST is taken care with Union Finance Minister, in the month of January Decision was taken to make a panel who will help to boost the real estate industry under GST.
The Minister in GOM are mostly finance of each state like:
- Punjab Manpreet Singh Badal,
- Rajesh Agarwal from Uttar Pradesh,
- Thomas Issac from Kerala,
- Maharashtra Sudhir Mugantiwar,
- Karnataka’s Krishna Gowda,
- Goa minister Mauvin Godinho.
All these ministers would be taking care of what should be presented in front of the GST Council.