New Delhi: The government on Saturday said that buyers of real estate properties will not have to pay Goods and Services Tax (GST) if they purchase the fully constructed property after the issue of completion certificate.
"It is brought to the notice of buyers of constructed property that there is no GST on sale of complex/building and ready-to-move-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 sale of under construction property or ready-to-move-in flats where completion certificate has not been issued at the time of sale, it said.
The Ministry further 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 eight per cent.
"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 in his account books to pay the output GST," the statement said.
For projects other than 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 effective tax rate has been down," it said.