No GST on sale of flats with completion certificate: govt

The government yesterday said that people will not have to pay Goods and Services Tax (GST) if they buy fully constructed properties after the issue of completion certificates.

“It is brought to the notice of buyers of constructed property that there is no GST on sale of complex/building and ready-tomove-in flats where sale takes place after issue of completion certificate by the competent authority,” the Ministry of Finance said in a statement.

The GST is applicable on the sale of under-construction properties or ready-to-move-in flats where completion certificates have not been issued at the time of sale, the statement said.

The ministry also said that housing projects in the affordable segment such as Jawaharlal Nehru National Urban Renewal Mission, Rajiv Awas Yojana, Pradhan Mantri Awas Yojana or any other housing scheme of state governments will attract GST of 8%.

“For such projects, after offsetting input tax credit, the builder or developer in most cases will not be required to pay GST in cash as the builder would have enough ITC (input tax credit) in his account books to pay the output GST,” the statement said.

For projects other than in the affordable segment, the government said it is expected that the cost of the complex/buildings/ flats would not have gone up due to implementation of GST.

“Builders are also required to pass on the benefits of lower tax burden to the buyers of property by way of reduced prices/instalments, where the effective tax rate has been down,” it said.