The meeting took place via videoconference. It is also reported that several states wanted a physical meeting for this agenda and thus the council decided to postpone the meeting and the decision remained inconclusive.
With regard to GST rate on under-construction housing properties, Jaitley said, since certain states wanted a physical meeting for this agenda, hence, the Council would meet again on February 24 to take a decision. “Today's meeting has been adjourned till Sunday,” Jaitley said, adding discussion on real estate and the lottery will continue.
The GST council today was expected to take a call on the reduction of tax on under-construction residential properties at 5 per cent, down from 12 per cent currently. The council was also expected to endorse a tax of 3 per cent on the affordable housing category, down from 8 per cent.
On the affordable housing segment, it was suggested that GST should be slashed to 3 per cent, from 8 per cent. Currently, GST is levied at 12 per cent with an input tax credit (ITC) on payments made for under-construction property or ready-to-move-in flats where completion certificate has not been issued at the time of sale. The effective pre-GST tax incidence on such housing property was 15-18 per cent.
The panel was also expected to review tax rate on the lottery and favoured a uniform GST rate of either 18 per cent or 28 per cent. A final call on this would be taken by the GST Council at its meeting on Sunday. Currently, a state-organised lottery attracts 12 per cent GST while a state-authorised lottery attracts 28 per cent tax.