In a major relief to thousands of home buyers in Andhra Pradesh, the Deputy Commissioner, Central Board of Excise and Customs (CBEC) restrained the Builders/ Construction Companies from asking the customers to pay higher rate of tax after the rollout of Goods and Services Tax (GST) on 1st July 2017.
A press note issued by the Deputy Commissioner on Wednesday clarified that under the price of the property would decline under the GST as all the other taxes would subsume under the new indirect tax regime.
“Incidence of Central Excise Duty, VAT, Entry tax etc. on the construction material is currently borne by the builders which they pass on to the customers as part of the price charged on them. This is not visible to the customers as it forms part of the cost of the flat.”
“This will change under GST. Under GST, full input tax credit would be available for offsetting the GST rate of 12%. As a result, the input taxes embedded in the flat will not (and should not) form a part of the cost of the flat,” he said.
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