Dec. 22, 2018

The GST Council of India is planning to lower taxes on houses and under-construction flats to 5% in the meeting next month. The Goods and Services Tax (GST) is currently 12% on under-construction or ready-to-move-in houses where the certificate of completion has not yet been issued. The official stated that the rate paid by builders had been offset in part by taxes paid on inputs and the benefits were not passed on to buyers. Therefore, some suggestions were proposed and the Council would look into them next month.

Since taxes on almost 360 items of goods and services are also being lowered, these changes are welcome as a significant measure to reduce the tax burden on people. Besides, the reduction on the compliance burden when filing tax returns is beneficial for small businesses. Most experts praised the GST Council since lower taxes would definitely help to boost the economy. And once the approaching general elections are over, the reduction on taxes is unlikely to be reversed.