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Comparative Studies | Economics & Finance | India | Volume 11 Issue 12, December 2022 | Popularity: 4.8 / 10

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Comparative Study of Pre GST and Post GST in India on Real Estate Sector

Shreya Rathore

Abstract: The concept of taxation has existed in the globe for a very long time. The idea of taxes and how they are collected have undergone significant change over time. Introduction of Goods and Service Tax has completely transformed the nation's indirect taxation system. It quickly became a contentious issue in every home or institution. The GST brought with it a variety of new changes. All of these changes had an impact on every citizen in some way. When purchasing property under construction under the previous tax regime, the purchaser was required to pay VAT, service tax, stamp duty, and registration fees. After-completion property was exempt from VAT and service tax, with only stamp duty and registration fees payable. Now, the GST will make buying a home less expensive because developers had to pay excise duty, import duty, CST, and entry tax on their business side under the previous tax structure, while consumers had to pay Service Tax and VAT on residential units purchased before they were finished, all of which are non-creditable tax costs and are reflected in the price of the units. The consistent tax rate will enable developers to cut their expenses and pass the savings along to customers because they will receive input credits on GST paid for services and commodities purchased. Following the advent of GST, the Value Added Tax (VAT) tax system is being streamlined. The government did not include stamp duties in the GST after it was implemented. The GST Act of 2017's Schedule III states that readily accessible properties are not considered to be goods or services. It is more like buying or selling a piece of property than anything else. Therefore, properties that are RTM into and have official Completion Certificates are GST-free. On the sale of land or the acquisition of resold properties, individuals will not be obliged to pay GST. In addition to the aforementioned exemption, real estate developers are also eligible for the GST system's Input Tax Credit on building supplies. Notably, in order to qualify for these advantages, developers must fulfill a few prerequisites. This paper aims to discuss some of the pre and post GST impacts on the real estate sector brought on by this newly implemented tax system, as well as how all citizens of the country are reacting to it.

Keywords: GST, Real Estate, Schedule III, Custom Duty, Excise Duty, VAT

Edition: Volume 11 Issue 12, December 2022

Pages: 1017 - 1024

DOI: https://www.doi.org/10.21275/SR221221152648

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