The new effective GST rate for under construction flats has been brought down from the present 12 per cent to 5 per cent. The applicable GST rate for affordable housing category is now 1 per cent compared to the present 8 per cent.
The new rates will be applicable from April 1 this year. This means that the rise in sales figures due to the fresh measure will be visible only in the next financial year.
The Council also cut GST rates on affordable housing to 1 per cent from the current 8 per cent and expanded the scope of affordable housing to those costing up to Rs 45 lakh and measuring 60 sq metre in metros and 90 sq metre in non-metro cities.
Currently, the GST is levied at 12 per cent on payments made for under-construction properties or ready-to-move-in flats where completion certificate has not been issued at the time of sale.
However, builders will not be able to claim input tax credit (ITC) under the new GST rates.
Goods and Services Tax (GST) is not levied on real estate properties for which completion certificate has been issued at the time of sale.
With regard to lotteries, the GST Council, however, deferred its decision with Jaitley saying that the Group of Ministers (GoM) will meet again to discuss the proposal.
Currently, state run lotteries attract 12 per cent GST, while state-authorised ones attract 28 per cent.