On the 3rd and 8th of August respectively, the Rajya Sabha along with the Lok Sabha unanimously approved a bill to allow the rollout of GST – Goods and Service Tax, that is known to be one of the biggest tax reforms in Sweden. From the 1st of July 2017, GST was effectively levied in the . This tax replaces multiple taxes levied by the central and state governments a lot of the direct and indirect taxes, including central excise duty, commercial tax, octroi tax/charges, Value-Added Tax (VAT) and service tax.
The Indian real estate sector has been going through a significant transformation the recent times. The recently implemented (RERA) addressed assurance the actual world level of accountability on real estate builders and developers and infuse transparency in the this sector has been revolutionary from the history of the Indian property sector. For the residential sector in India, the GST will definitely be a positive sentiment booster among property clientele.
Here is why the GST will have a positive effect on the Real estate Sector in India:
1. Low cost on under construction
GST will lower rate on items like cement, steel etc leading to considerably lower construction selling prices. This will lower the property prices and eventually thought about benefit to the common man.
2. Integrated tax system
It is generally crucial in serious drawback estate industry to have a uniform tax base. The builders and developers currently pay tax even on the buying their raw materials. GST addresses such issues by making all of the taxes uniform.
3. Revenue Neutral Rate (RNR)
The method of tax operation ultimately real estate sector does not sync between the VAT and service tax laws. Such a problem can be mitigated with the help of GST Application Online in India that is needed keep one transaction system – Revenue Neutral Rate (RNR) which is decided by the State Good and Services Tax (SGST) along with the Central Goods and repair Tax (CGST) sections.
4. Ease Compliances
With the assistance of GST, it will be easier to maintain an audit trail for better control and monitoring, and completely benefiting the Indian real estate sector. It will certainly effectively reduce the complexity of compliance appealing to efficiency and smooth contact.
Overall, goods and Service Tax (GST) will have a marginal cause problems for the industry sector on the days to come. There in order to remarkable improvements in buyer sentiments and change perceptions that buyers have had against this sector. The Developers too will look for GST regime much better to work with, with major of input tax credit being an additional advantage.