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GST rate reduced on purchase of houses, relief for 1st-time buyers
In a relief to the house buyers, the GST rate has been reduced to 8% from the existing 12% on purchase of houses availing of the credit-linked subsidy scheme (CLSS) under Pradhan Mantri Awas Yojna.
In a relief to the house buyers, the GST rate has been reduced to 8% from the existing 12% on purchase of houses availing of the credit-linked subsidy scheme (CLSS) under Pradhan Mantri Awas Yojna.
Under the scheme, a first-house buyer purchasing a house or apartment of up to 150 square metres (1,615 sq ft) carpet area with a household income of up to Rs 18 lakh per annum can avail a benefit of up to Rs 2.7 lakh
The tax benefit will also be extended to an affordable housing project that has got infrastructure status.
GST at 12 percent will be paid for the same house by those who don’t qualify for the CLSS scheme while those buying their second house, or more, would not be able to avail this benefit.
Irrespective of the buyer getting the CLSS benefit under PM Awas Yojna, GST will be levied at 8 percent.
Chairman of the Confederation of Real Estate Developers' Association of India (Credai), Getamber Anand said that the decision will have a push on the real estate sector particularly affordable housing, as prices will fall by up to 4 percent.
He informed that the cap on the size of housing unit has been kept at 1,615sqft carpet area, indicating around 2,200sq ft built-up area which is likely to cover most three-bedroom apartments and houses in the country.
