On August 3 and August 8, respectively, the Rajya Sabha and Lok Sabha unanimously passed a bill to allow the implementation of the GST (Goods and Services Tax), which is known to be one of the biggest tax reforms in India. Since July 1, 2017, GST has been effectively leveraged in the country. This tax replaces multiple taxes levied by the central and state governments and all direct and indirect taxes, including central excise taxes, business tax, entitlement tax/charges, value added tax (VAT), and income tax. services.

The Indian real estate sector has been undergoing a significant transformation in recent times. The recently implemented (RERA) addressed the guarantee on the level of responsibility of real estate builders and developers and instilling transparency in this sector has been revolutionary in the history of the Indian real estate sector. For the residential sector in India, the GST will definitely be a positive sentiment booster among property buyers.

Here is why the GST will have a positive effect on the real estate sector in India:

1. Low cost in construction
GST will lower the rate on items like cement, steel, etc., leading to considerably lower construction costs. This will lower real estate prices and will eventually be a benefit to the common man.

2.Integrated tax system
Generally, it is crucial in the real estate industry to have a uniform tax base. Builders and developers currently pay taxes even on the purchase of their raw materials. GST addresses these issues by making all taxes uniform.

3. Revenue Neutral Rate (RNR)
The method of fiscal operation in the real estate sector is not synchronized between the VAT laws and the service tax. Such a problem can be mitigated with the help of GST that would help maintain a transaction system: the Revenue Neutral Rate (RNR) decided by the State Goods and Services Tax (SGST) departments and the Central Goods and Services Tax ( CGST).

4. Facilitate compliance
With the help of GST, it will be easier to maintain an audit trail for better control and tracking, fully benefiting the Indian real estate industry. It will effectively reduce the complexity of compliance by bringing efficiency and seamless transactions.

In general, the goods and services tax (GST) will have a marginal impact on the real estate sector in the coming days. There will be noticeable improvements in buyer sentiment and the perceptions that buyers have had against this sector will change. Developers will also find GST to be much easier to work with, with the benefit of the entry tax credit as an added bonus.