GST Ball in Customers court now

GST Ball in Customers court now

In the GST front on real estate now government has came up with their decision. The Government has given developers the option to either levy 12 per cent GST on under- construction houses and take input tax credit (ITC) or go for 5 percent GST without taking ITC. While it may seem that  it has done builders a favour by giving them a choice, it is ultimatesly customers who will decide  what GST developers can charges. Now all the ball is in the customers hand.

This decision is looking beneficial for the reality sector. That is because property prices have been stagnant for three years. With the massive unsold inventory that developers are stuck with, real estate is now a buyers market. Developers will have to charge what customers are willing to pay, and it is the lower rate of 5 per cent. Developers are hopeful to get some peak in the demand.

This will also benefit developers as sales and customer advances will increase due to lower taxes, resulting in less dependence on debt. With the GST ball being in the customers court now, a 5 per cent tax without ITC is what most developers will end up levying. This is the talk of future that it met the expectation of developers or not.