SARE Homes quote on GST
India 04 August 2016: "The
implementation of GST is likely to improve transparency and reduce tax
evasion on account of better enforcement and compliance. The home buyer
in general could benefit from the introduction of GST if the rates are
moderate. The fact that works contract would be taxed as a service under
the model GST law is a welcome move and is expected to provide
certainty on taxability of the construction sector. This should lead to
reduction in tax costs as the tax would be now charged on the actual
contractual base and there would not be any overlap of VAT and service
tax on a certain portion of such contracts like under the current
regime. However, for the developer, the aspect of valuation is a matter
of concern as currently no deduction is provided under GST for value of
land. This can contribute to higher tax burden considering that there is
already an additional tax incidence in the form of Stamp duty on value
of land.”
