The construction sector in Amaravati is hopeful to gain momentum with the recent changes proposed in the GST slabs. The Union government recently proposed to tweak existing tax slabs reducing GST to 5 per cent from 12 per cent on under construction houses and flat, one per cent on houses with less than 90 square meters carpet area.
Tummala Vamshi Krishna, the general secretary of Builders Association of India, Amaravati chapter said that the sales volumes will definitely increase as the prices likely to come down by 7 per cent in cases of under construction houses. The proposed flat one per cent tax on the houses having carpet area less than 90 square meters will have a much more positive impact as the prices are expected to come down by 11 per cent. He added that more than 60 per cent of the houses will fall in this category, and if the flat one per cent tax is implemented that will make a difference of Rs 3.3 lakh to Rs 4 lakh on the prices of the houses. The builders are however still concerned over restoration of 18 per cent tax on payments to labour, which will erode all the benefits accrued through reduction of the tax slabs. Union government gave temporary exemption for GST on labour till March. The law makes builders liable for GST on payments to labour.
