GST Council meeting tomorrow, rate cut on real estate expected

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After having deferred a decision to rationalise GST rates on housing properties and lotteries in its last meeting through video-conferencing on Wednesday, the GST Council is expected to make an announcement tomorrow. On Wednesday, several non-BJP states had disagreed to make a decision on the issue without being physically present in the meeting. As a result, union finance minister Arun Jaitley had announced that a final decision on the GST rate will be taken up in a meeting on Sunday. There have been enough indications in the past that the government may push for a rate cut in the real estate sector.

A Group of Ministers (GoM) on real estate sector, headed by Gujarat deputy chief minister Nitin Patel, had earlier this month suggested cutting GST on under-construction residential properties to 5% without input tax credit (ITC), from 12%, currently. On affordable housing segment, it suggested that GST should be slashed to 3% from 8%. Even in the budget speech, the then finance minister Piyush Goyal had favoured a rate cut. “Our government wants the GST burden on home buyers to be reduced and accordingly we have moved the GST Council to appoint a Group of Ministers to examine and make recommendations in this regard at the earliest,” Piyush Goyal, who was handling the finance ministry then, had said.

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