As the economy gears up for the goods and services tax (GST), the real estate sector is the one in focus today. The sector will attract a tax rate of 12 percent but there will also be availability of input tax credit on construction materials.
In an interview to CNBC-TV18, Irfan Razack, CMD of Prestige Estates Projects and Pratik Jain, Leader - Indirect Tax at PWC India assesses the impact on the sector.
Speaking about GST and Real Estate Regulatory Authority (RERA), Razack said that, “rules in many states that we operate in are not yet placed.”
Any change that happens takes time for people to understand, to adapt and to comply with, he said.
“It (GST) will create confusion in the minds of the customers and developers. There will be a bit of a churn for a few weeks or months after that things will completely stabilise,” Razack added.
Tough to say if realty prices will rise or fall post GST roll out, he said.
Pratik Jain, Leader - Indirect Tax at PWC India believes that effective tax rate for buyers would significantly increase post GST rollout.
For full discussion, watch accompanying video...
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