Facility of input tax credit- Budget 2021 Expectations: The real estate sector has demanded the facility of input tax on raw materials like cement, steel used during the development of leased commercial property. The real estate industry says that input tax credit should be provided in the tax on income from rental of commercial property. In the pre-budget suggestions made by the real estate industry on Sunday, the move said that the move will also help India maintain its leadership in areas such as information technology (IT), startups, realty companies and consultants.
Read also: Budget 2021 expectations: brainstorm on exempting companies from ESIC contributions
The Confederation of Indian Industry (CII), the industry body, sought to amend section 16 and section 17 (5) of the Central Goods and Services Tax (CGST) Act in the suggestion made for the financial year 2021-22, so that real estate companies can build During the period, you can avail input tax credit (ITC) on the purchase of goods and services. The organization said that non-receipt of ITC stings capital of real estate developers.
Read also: Budget 2021 Expectations: Luxury car companies demand tax cuts in budget from government
CII said, “It takes 18 per cent GST to rent properties for commercial renting or leasing outlets in malls.” Non-receipt of ITC during construction leads to cost of construction and loss of working capital. This affects the entire supply chain. Sanjay Dutt, managing director (MD) and chief executive officer (CEO) of Tata Realty and Infrastructure Ltd, said that under the current provisions of GST, input tax credit is not available during the construction phase. However, its benefits should be given to reduce the cost of construction.
Read also: Builder cannot make additional recovery in the name of increasing area