Under the Pradhan Mantri Gramin Awaas Yojana, the rate of goods and services tax (GST) has been reduced from 12% to 8% by taking advantage of the benefit of the credit linked subsidy scheme (CLSS). It is that the house or apartment carpet area 150 square meters i.e. 1,615 square feet.
The new rate will be applicable to houses made in infrastructure status projects. Under the CLSS scheme, the government gives a subsidy of up to 2.7 lakh rupees for the first time to earn annual income of 18 lakhs. The condition is that the carpet area of the house or apartment will not be more than 150 square meters i.e. 1,615 square feet.
Due to low rate of GST cheap house sale will increase: People who are not eligible to take advantage of the Credit Linked Subsidy Scheme, they will have to give GST at the rate of 12% on buying a house. However, in the housing status received housing projects 646 square feet of carpet area houses or flats, buyers will also get 8% tax instead of 12%. There will not be a ‘buy for the first time’ on such home or flat buyers. Whether such buyer avails the CLSS scheme under the PMH accommodation scheme, they will have to give GST at the rate of 8%.
Gitamber Anand, chairman of the Confederation of Real Estate Developers Association of India (CREDAI), said, “This decision will accelerate the real estate sector, especially in the prices of cheap houses because the price will fall by 4%.”
He said that to take advantage of the CLSS scheme, the limit of the carpet area of the house or flat has been kept at 1,615 square feet which is equal to the built-up area of about 2,200 square feet.In that country’s and especially metropolis mostly apartment of three bedrooms and home will come.
According to them, for the first time, the limit of annual earnings of 18 lakhs for home buyers is also sufficient. But they are not going to get the benefit, they are going to buy a second or more home.
Vice Chairman of National Real Estate Development Council Pravin Jain said, “This decision will prove to be a boon for the common people and this will get the fast pace of development of the real estate sector. This will help everyone to fulfill their dream of home till 2022. Developers give GST at the cost of building a project. Under the GST, the tax paid on behalf of the developers is given to the buyer as a credit.