Ministers suggest increasing affordable housing limit to Rs 5.5 million
Real Estate

Ministers suggest increasing affordable housing limit to Rs 5.5 million

A group of ministers (GoM) appointed by the Goods and Services Tax Council to examine the application of GST in the real estate sector believes that the definition of affordable housing should be expanded to Rs 5.5 million from the current Rs 4.5 million, according to sources familiar with the matter.

If the GST Council approves this change, it could provide a substantial boost to the affordable housing sector. Currently, affordable housing is subject to a GST rate of 1%, while other housing projects face a 5% levy. Additionally, the input tax credit (ITC) facility is not available in either case.

The seven-member GoM, led by Goa's Chief Minister Pramod Samant, is also expected to recommend increasing the tax on luxury housing priced above Rs 15 crore and may not offer any relief regarding joint development agreements (JDAs) concerning the application of GST.

According to a person aware of the panel discussions, there was a general consensus that the definition of affordable housing for GST purposes should be enhanced; however, most members opposed applying GST to JDAs. The GoM convened last week in Goa and is anticipated to submit its report ahead of the next GST Council meeting, expected in the second week of November. The final decision on the recommendations will be made by the GoM.

Other members of the GoM include Samrat Choudhary, Deputy Chief Minister of Bihar; Suresh Kumar Khanna, Finance Minister of Uttar Pradesh; KN Balagopal, Finance Minister of Kerala; Aditi Tatkare, Minister for Women and Child Development and GST Council representative for Maharashtra; Harpal Singh Cheema, Finance Minister of Punjab; and Kanubhai Mohanlal Desai, Finance Minister of Gujarat.

The 33rd GST Council meeting in February 2019 defined affordable housing, in the case of flats, as having a carpet area of up to 90 square meters in non-metropolitan cities and towns, and 60 square meters in metropolitan areas.

A group of ministers (GoM) appointed by the Goods and Services Tax Council to examine the application of GST in the real estate sector believes that the definition of affordable housing should be expanded to Rs 5.5 million from the current Rs 4.5 million, according to sources familiar with the matter. If the GST Council approves this change, it could provide a substantial boost to the affordable housing sector. Currently, affordable housing is subject to a GST rate of 1%, while other housing projects face a 5% levy. Additionally, the input tax credit (ITC) facility is not available in either case. The seven-member GoM, led by Goa's Chief Minister Pramod Samant, is also expected to recommend increasing the tax on luxury housing priced above Rs 15 crore and may not offer any relief regarding joint development agreements (JDAs) concerning the application of GST. According to a person aware of the panel discussions, there was a general consensus that the definition of affordable housing for GST purposes should be enhanced; however, most members opposed applying GST to JDAs. The GoM convened last week in Goa and is anticipated to submit its report ahead of the next GST Council meeting, expected in the second week of November. The final decision on the recommendations will be made by the GoM. Other members of the GoM include Samrat Choudhary, Deputy Chief Minister of Bihar; Suresh Kumar Khanna, Finance Minister of Uttar Pradesh; KN Balagopal, Finance Minister of Kerala; Aditi Tatkare, Minister for Women and Child Development and GST Council representative for Maharashtra; Harpal Singh Cheema, Finance Minister of Punjab; and Kanubhai Mohanlal Desai, Finance Minister of Gujarat. The 33rd GST Council meeting in February 2019 defined affordable housing, in the case of flats, as having a carpet area of up to 90 square meters in non-metropolitan cities and towns, and 60 square meters in metropolitan areas.

Next Story
Equipment

Handling concrete better

Efficiently handling the transportation and placement of concrete is essential to help maintain the quality of construction, meet project timelines by minimising downtimes, and reduce costs – by 5 to 15 per cent, according to Sandeep Jain, Director, Arkade Developers. CW explores what the efficient handling of concrete entails.Select wellFirst, a word on choosing the right equipment, such as a mixer with a capacity aligned to the volume required onsite, from Vaibhav Kulkarni, Concrete Expert. “An overly large mixer will increase the idle time (and cost), while one that ..

Next Story
Real Estate

Elevated floors!

Raised access flooring, also called false flooring, is a less common interiors feature than false ceilings, but it has as many uses – if not more.A raised floor is a modular panel installed above the structural floor. The space beneath the raised flooring is typically used to accommodate utilities such as electrical cables, plumbing and HVAC systems. And so, raised flooring is usually associated with buildings with heavy cabling and precise air distribution needs, such as data centres.That said, CW interacted with designers and architects and discovered that false flooring can come in handy ..

Next Story
Infrastructure Urban

The Variation Challenge

A variation or change in scope clause is defined in construction contracts to take care of situations arising from change in the defined scope of work. Such changes may arise due to factors such as additions or deletions in the scope of work, modifications in the type, grade or specifications of materials, alterations in specifications or drawings, and acts or omissions of other contractors. Further, ineffective planning, inadequate investigations or surveys and requests from the employer or those within the project’s area of influence can contribute to changes in the scope of work. Ext..

Advertisement

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Talk to us?