Looking to buy a home? Ready-to-move-in apartments to cost more despite GST

Normally, ready properties are priced 20-30 per cent higher than those under construction

 

 

Though ready-to-move-in apartments have been kept out of the Goods and Services Tax's (GST's) ambit, they will continue to cost more than those under construction.

Normally, ready properties are priced 20-30 per cent higher than those under construction.
"Ready properties always cost more. Earlier, too, there was no service tax on ready properties but developers always charged more premium on them," said Sandeep Runwal, director at Runwal group, a Mumbai-based developer.

Amit Bhagat, chief executive officer at ASK Property Investment Advisors, said that since buyers have to pay GST they have to take a call whether they will make their contribution upfront and buy ready apartments or buy an under-construction apartment and make a staggered payment over the next five years.

Under-construction properties carry a tax rate of 12 per cent under GST.

"Ready apartments are not affordable for first-time buyers and they always prefer to go for staggered payments given their rising income levels, age and so on," Bhagat said.

He said that depending on the price of the product, the GST burden will increase on the end-consumer if the property is priced above Rs 6,000 per sq ft... read more...

GST impact: Manufacturing key winner, telecom likely to be worse off

The realisation of a common indirect tax is critical for the semblance of a common Indian market

 

 

The implementation of GST could very well be a step in this direction, in untangling the complicated web of the indirect tax base in India. However, one may add here that, the imposition of the GST (from July) is a minor step in the direction of reducing the incidence of indirect taxes in relation to the overall tax burden.

 

The probable impact of GST?

It may be difficult to realistically depict a quantifiable impact of GST across various sectors unless a specific GST tax rate is known from the government’s end, which analysts earlier estimated to be somewhere around 17% or 18%.

Considering that the discussion across the board on the GST tax rate started with rate discussions of 12% and 18%; the four slab rates of 5%, 12%, 18% and 28%, with identified de-merit goods subject to levy of cess over and above peak rate of 28% was a dampener for the industry, as argued here.

The newly designed multiple rate structure is derived from the fact that current effective indirect taxes (both centre and state) over certain bands are maintained for revenue neutrality and linked to above rate slabs.

The likely winners from the imposition of the GST as a centralised indirect valued added tax, will be from the manufacturing segment, including the automobile manufacturers, the FMCG (Fast Moving Consumer Goods) segment, the retail sector (provided consumer demand picks up) and the cement sector. Income Tax.

One of the key losers could be the telecom sector, with the rise in GST tax rate, unless the VAT and CENVAT simultaneously see a marginal drop in their rates too. The sector is already plagued with serious problems pertaining to data volumes and slow bandwidth penetration across the country.

Tax reforms like the GST is history in the making and the final passing of the GST bill (now in its final stages) will be termed as one of India’s biggest legislative success...  read more...

GST not being charged twice over on credit card payments: Govt busts 7 myths

Please do not recirculate such message without checking it with authority," Adhia said.

 

 

Two days into the GST regime, Revenue Secretary Hasmukh Adhia today took to Twitter to bust "seven myths" that were doing the rounds about the new tax regime.

Adhia, the architect behind the country's largest tax reform, sought to dispel concerns that if a person makes payment of utility bills by credit cards, the he/she will be paying GST twice.

"This is completely untrue. Please do not recirculate such message without checking it with authority," Adhia said.

India ushered in the Goods and Services Tax (GST) regime on the intervening night of June 30 and July 1.

A four-tier tax slab -- 5, 12, 18 and 28 per cent -- has been decided with essential items like salt, unpacked food grains, healthcare services being kept zero rated.



People have been posting in social media pictures of receipts issued in grocery stores or eateries showing tax deductions as GST, instead of VAT/Service tax earlier.

Busting the myth that GST rates are higher than VAT, Adhia said, "It appears higher because excise duty and other taxes which were invisible earlier are now subsumed in GST and so visible now." Income Tax

He reiterated that businesses can continue to do business under GST with provisional ID number and need not wait for Goods and Services Taxpayer identification number (GSTIN).

"Provisional ID will be your final GSTIN number. Start business," Adhia said.

He said that businesses need not generate all invoices on computer or internet alone. "Invoices can be generated manually also."..... read more.....