1. Budget 2018: Housing For All by 2022 will be possible if Modi government includes these points in its budget

Budget 2018: Housing For All by 2022 will be possible if Modi government includes these points in its budget

Budget 2018: In July last year, Modi government introduced GST or Goods and Services Tax. As per the pre-budget memorandum by NAREDCO, the intent of GST is to be tax neutral and create One Nation One Tax.

By: | New Delhi | Updated: January 24, 2018 1:10 AM
budget 2018, budget date, budget 2018 india, India budget, Union budget 2018, budget 2018 expectations, Housing for all by 2022, Modi government, Pradhan Mantri Awas Yojana Budget 2018: Before GST, the taxes on Housing sector were 4.5 per cent Service Tax and 1 per cent VAT, total 5.5 per cent.

Budget 2018: With just days remaining for the union budget to go on the floor, industry giants from various sections have come forward to give their suggestions that may be included in the budget 2018. On February 1, finance minister Arun Jaitley will present the union budget and the entire country will be glued to the screen, in hopes for a better fiscal year. In July last year, one of the biggest decisions that were implemented by the Modi government was the inclusion of GST or Goods and Services Tax. According to the pre-budget memorandum by NAREDCO, the intent of GST is to be tax neutral and create One Nation One Tax. However, people in the housing sector are bearing the brunt of GST and are hoping for some relaxation in the union budget.

Before GST, the taxes on Housing sector were 4.5 per cent Service Tax and 1 per cent VAT, total 5.5 per cent. However, after the implementation of GST, 5.5 per cent tax has gone up to 12% (after abatement for land), which is more than double. As this tax burden is ultimately passed onto the end consumers, they are feeling the real pinch of GST. And many are avoiding investment in under construction properties, especially when there is no GST on completed housing properties where completion certificate has been obtained.

This move doesn’t align and contradicts the basic objective of GST, that is to be tax neutral. However, this has impacted even the affordable housing projects under Pradhan Mantri Awas Yojana “Housing for all by 2022”. In its pre-budget memorandum, NAREDCO has requested the Modi government to bring GST on under construction housing properties to 12 per cent slab, with 50 per cent abatement for land, and Input Tax Credit (ITC), from existing 18 per cent slab with 1/3rd abetment for land and Input Tax Credit. This will bring the effective GST rate at 6 per cent, which ultimately will be tax neutral for the end consumers.

The NAREDCO pre-budget memorandum also highlighted another aspect which can benefit home buyers and realtors. It asked the government to impose No GST on end consumers and No Input credit to the developer. This will create a win-win situation for all. Government will not lose revenue and consumers will not have to pay GST. This will also create a healthy market for the housing sector.

Calculate your income tax post budget 2018 through this Income Tax Calculator, get latest news on Budget 2018 and Auto Expo 2018. Like us on Facebook and follow us on Twitter.

  1. U Nandakumar Narath
    Jan 22, 2018 at 9:23 am
    As part of housing to all policy the govts should give priority to promoting ecofriendly,resource efficient, cost effective climate smart multistorey buildings of varied nature suited to the tastes of different categories of families.
    Reply
    1. Mukund Puranik
      Jan 22, 2018 at 12:00 am
      If Modi Government really wants Housing for all policy in this budget then there should be central as well as state law about following. Tenanted building and specific formula for tenants to get converted in to ownership by surrounding their tenantship. Most of the rules at present are only related to Mumbai, MHADA tenants or tenants residing in diapilited building and applicable only in and around Mumbai. There are several hundred buildings built exclusively for tenants in places like Pune, Nasik, Aurangabad etc. Builders are forcing tenants to either evacuate the building with peanut compensation or demand market rate for ownership without alternative accommodation during transit period. Builders always say that all the concessions if given by Government are applicable only in Mumbai and demand for only Government GR. All this is done before project is registered under RERA. Mail visit to RERA office, tenants are simply rejected. Reply of Apale sarkar awaited. Twit to CM no reply
      Reply

      Go to Top