{"id":2635,"date":"2016-08-10T12:29:19","date_gmt":"2016-08-10T06:59:19","guid":{"rendered":"http:\/\/carajput.com\/blog\/?p=2635"},"modified":"2021-12-21T13:06:57","modified_gmt":"2021-12-21T07:36:57","slug":"impact-of-gst-on-real-estate-industries-of-india","status":"publish","type":"post","link":"https:\/\/carajput.com\/blog\/impact-of-gst-on-real-estate-industries-of-india\/","title":{"rendered":"Impact of GST on Real Estate Industries of INDIA"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_58 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Page Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a056e2c7e83b\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #000000;color:#000000\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #000000;color:#000000\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a056e2c7e83b\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/carajput.com\/blog\/impact-of-gst-on-real-estate-industries-of-india\/#What_is_the_impact_of_GST_on_real_estate_industries_of_INDIA\" title=\"What is the impact of GST on real estate industries of INDIA?\">What is the impact of GST on real estate industries of INDIA?<\/a><ul class='ez-toc-list-level-3'><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/carajput.com\/blog\/impact-of-gst-on-real-estate-industries-of-india\/#POSITIVE-_IMPACT_OF_GST_ON_WAREHOUSING_AND_INDUSTRIAL_PROPERTY\" title=\"POSITIVE- IMPACT OF GST ON WAREHOUSING AND INDUSTRIAL PROPERTY\">POSITIVE- IMPACT OF GST ON WAREHOUSING AND INDUSTRIAL PROPERTY<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/carajput.com\/blog\/impact-of-gst-on-real-estate-industries-of-india\/#Neutral-_Impact_of_GST_on_commercial_property\" title=\"Neutral- Impact of GST on commercial property\">Neutral- Impact of GST on commercial property<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/carajput.com\/blog\/impact-of-gst-on-real-estate-industries-of-india\/#Neutral-_Impact_of_GST_on_residential_property\" title=\"Neutral- Impact of GST on residential property\">Neutral- Impact of GST on residential property<\/a><ul class='ez-toc-list-level-4'><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/carajput.com\/blog\/impact-of-gst-on-real-estate-industries-of-india\/#E-Invoice_Mechanism_under_the_GST\" title=\"E-Invoice Mechanism under the GST\">E-Invoice Mechanism under the GST<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/carajput.com\/blog\/impact-of-gst-on-real-estate-industries-of-india\/#BlockingUnblocking_the_E-Way_Bill_creation_system_if_fails_to_file_GSTR-3B_GSTN\" title=\"Blocking\/Unblocking the E-Way Bill creation system if fails to file GSTR-3B: GSTN\">Blocking\/Unblocking the E-Way Bill creation system if fails to file GSTR-3B: GSTN<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/carajput.com\/blog\/impact-of-gst-on-real-estate-industries-of-india\/#Reasons_for_the_Movement_of_Goods_under_the_GST\" title=\"Reasons for the Movement of Goods under the GST\">Reasons for the Movement of Goods under the GST<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<figure id=\"attachment_8983\" aria-describedby=\"caption-attachment-8983\" style=\"width: 650px\" class=\"wp-caption alignnone\"><a href=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2016\/08\/18.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-8983\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2016\/08\/18.jpg\" alt=\"www.carajput.com; GST\" width=\"650\" height=\"350\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2016\/08\/18.jpg 650w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2016\/08\/18-300x162.jpg 300w\" sizes=\"(max-width: 650px) 100vw, 650px\" \/><\/a><figcaption id=\"caption-attachment-8983\" class=\"wp-caption-text\">www.carajput.com; GST<\/figcaption><\/figure>\n<h2><span class=\"ez-toc-section\" id=\"What_is_the_impact_of_GST_on_real_estate_industries_of_INDIA\"><\/span><strong>What is the impact of GST on real estate industries of INDIA?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p style=\"text-align: justify;\">The introduction of <a href=\"https:\/\/www.caindelhiindia.com\/blog\/application-of-gst-on-contribution-by-rwa-members\/\">GST <\/a>would enhance attractions of other countries towards India as the investment destination through encouraging easier operations and higher transparency especially in property deals.<\/p>\n<p style=\"text-align: justify;\">In short term basis, the warehousing segment and industrial property shall be the most beneficial sectors of GST Adoption.<\/p>\n<p style=\"text-align: justify;\">However nothing can be firmly said if adoption of GST system will definitely bring the prices down in residential and commercial segments as sales of immovable property on which stamp duty continues to apply is outside the ambit of GST.<\/p>\n<h3 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"POSITIVE-_IMPACT_OF_GST_ON_WAREHOUSING_AND_INDUSTRIAL_PROPERTY\"><\/span><strong>POSITIVE- IMPACT OF GST ON WAREHOUSING AND INDUSTRIAL PROPERTY<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p style=\"text-align: justify;\">As said earlier, in short run, the warehousing and industrial property sector shall be the prime beneficiary of Adoption of GST. The decision of establishing a warehouse shall no longer be on the base of tax arbitrage.<\/p>\n<p style=\"text-align: justify;\">It will be based on achievement of solving the optimal logistics. This will reduce the number of octroi checkpoints leading to considerable reduction in transportation time. Further, the Logistics companies shall look forward to establish large warehouses located on transit corridors.<\/p>\n<p style=\"text-align: justify;\">We can therefore see the development of spoke and hub system in the warehousing, the spokes being on feeder lines and hubs on the transit corridors. We thus are expecting the nation to become a massive large market by cost of products being brought down.<\/p>\n<p style=\"text-align: justify;\">Further, the recent Modi government initiatives like 100% FDI in e-commerce sector and \u201cMake in India\u201d shall also boost the warehousing and manufacturing sector. Various international players like E-bay and Amazon have entered Indian markets already and have started to occupy large spaces in warehouses to gain their share in the E-commerce industry.<\/p>\n<h3 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"Neutral-_Impact_of_GST_on_commercial_property\"><\/span><strong>Neutral- Impact of <span style=\"color: #000000;\"><a style=\"color: #000000;\" href=\"https:\/\/carajput.com\/services-ssi-registration.php\">GST<\/a> <\/span>on commercial property<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p style=\"text-align: justify;\">Commercial leasing makes up for the larger portion of commercial property business in our country. Currently, commercial property leasing is considered as a service under finance act,1994 and is thus is taxed as per service tax.<\/p>\n<p style=\"text-align: justify;\">The service tax being applicable at 15%. After the introduction of GST, it is assumed that this treatment shall remain unchanged and commercial property leasing will be subject to GST.<\/p>\n<p style=\"text-align: justify;\">The negative or the positive impact is primarily dependable on the GST rate which is applicable. Moreover, adding to this is the ambiguity about availability of GST tax credit which is paid on the procurement of services and goods during the phase of construction.<\/p>\n<h3 style=\"text-align: justify;\"><span class=\"ez-toc-section\" id=\"Neutral-_Impact_of_GST_on_residential_property\"><\/span><strong>Neutral- Impact of <a href=\"https:\/\/carajput.com\/services-ssi-registration.php\">GST<\/a> on residential property<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p style=\"text-align: justify;\">The impact of GST on the residential property sectors cannot be decided precisely as it is too early to comment. We have briefly analysed the effects of GST on 3 types of transactions of residential property, being, residential property leasing, sale of property which is under construction and sale of immovable property which is completed:<\/p>\n<ol style=\"text-align: justify;\">\n<li>Residential property leasing is currently not subject to service tax. This treatment is more likely to remain unchanged under GST Regime too.<\/li>\n<li>Sale of property which is under construction shall be covered under GST Regime. However, in present times it looks like there wouldn&#8217;t be much difference besides the fact being all forms of indirect taxes shall be clubbed under one single heading.<\/li>\n<li>Some benefit can be expected only if GST tax credit will be made available for developers for GST paid on services and goods.<\/li>\n<li>The sale of immovable property which is completed will in no way be impacted by GST as these transactions are outside the ambit of GST. On these transactions, stamp duty shall be made payable.<\/li>\n<\/ol>\n<p style=\"text-align: justify;\">To conclude it, we can expect the GST to increase(boost) the overall demand on real estate, especially on warehousing and industrial sector, due to impact on economy being positive overall. From the perspective of cost, more precision is required on various transactions on the applicability of GST tax credits.<\/p>\n<p style=\"text-align: justify;\">The developers must be able to get overall credit for various taxes paid on inputs if proper application of mechanism of credit utilisation is made. This will eventually lead to reduce the overall cost.<\/p>\n<p style=\"text-align: justify;\">We look forward for your valuable comments.\u00a0www.carajput.com<\/p>\n<p style=\"text-align: justify;\"><strong>FOR\u00a0 FURTHER\u00a0 QUERIES\u00a0 CONTACT\u00a0US:<\/strong><\/p>\n<p style=\"text-align: justify;\">W: www.carajput.com\u00a0 \u00a0 \u00a0\u00a0 E: singh@carajput.com\u00a0 \u00a0 \u00a0,\u00a0\u00a0 M: 9-555-555-480<\/p>\n<p><b>Popular blog:<\/b><\/p>\n<ul>\n<li>\n<h4><span class=\"ez-toc-section\" id=\"E-Invoice_Mechanism_under_the_GST\"><\/span><a href=\"https:\/\/carajput.com\/blog\/e-invoice-mechanism-under-the-gst\/\"><strong>E-Invoice Mechanism under the GST<\/strong><\/a><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<li>\n<h4><span class=\"ez-toc-section\" id=\"BlockingUnblocking_the_E-Way_Bill_creation_system_if_fails_to_file_GSTR-3B_GSTN\"><\/span><strong><a href=\"https:\/\/carajput.com\/blog\/blocking-the-e-way-bill-creation-system-if-fails-to-file-gstr-3b-gstn\/\">Blocking\/Unblocking the E-Way Bill creation system if fails to file GSTR-3B: GSTN<\/a><\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<li>\n<h4><span class=\"ez-toc-section\" id=\"Reasons_for_the_Movement_of_Goods_under_the_GST\"><\/span><strong><a href=\"https:\/\/carajput.com\/blog\/reasons-for-the-movement-of-goods-under-the-gst\/\">Reasons for the Movement of Goods under the GST<\/a><\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<h4 style=\"text-align: justify;\"><\/h4>\n","protected":false},"excerpt":{"rendered":"<p>What is the impact of GST on real estate industries of INDIA? The introduction of GST would enhance attractions of other countries towards India as the investment destination through encouraging easier operations and higher transparency especially in property deals. In short term basis, the warehousing segment and industrial property shall be the most beneficial sectors &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[172],"tags":[6256,9036],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/2635"}],"collection":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/comments?post=2635"}],"version-history":[{"count":5,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/2635\/revisions"}],"predecessor-version":[{"id":20327,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/2635\/revisions\/20327"}],"wp:attachment":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/media?parent=2635"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/categories?post=2635"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/tags?post=2635"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}