NO TAXING TIME FOR REAL ESTATE: GOVT

Normal 0 false false false EN-US X-NONE X-NONE /* Style Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:""; mso-padding-alt:0in 5.4pt 0in 5.4pt; mso-para-margin-top:0in; mso-para-margin-right:0in; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0in; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:"Calibri","sans-serif"; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:"Times New Roman"; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin;} Says constructionattracts service tax only on 33 per cent of the value. The government today said the netimpact of the service tax on realestate construction would be only 3.3 per cent, since construction attractsservice tax only on 33 per cent of the value. The government had last weekclarified through the Budget that transactions such as leasing vacant land and commercial spaces ,payment made to developers before the grant of completion certificate andimposing preferred location charges, among others, would come under the servicetax net. Developers said the proposalcould push home prices up by 10 per cent in Tier-II and Tier-III towns and0.5-4 per cent in big cities such as Mumbai and Delhi which have higher landprices. However, a senior finance ministry official here said the net impact ofthe service tax would be only 3.3 per cent, since there is an abatement of 67per cent. “There is a false impressionbeing created that prices will go up by 10 per cent but the fact is that 10 percent service tax is levied only on 33 per cent of the value,” said theofficial. The budgetary clarification hasbeen issued with retrospective effect from 2007, when real estate transactions were broughtunder service tax. Abatement scheme, under notification number 1/2006 datedMarch 1, 2006, says that the contractor is entitled to claim abatement to theextent of 67 per cent of the value of services rendered by him. In effect, thecontractor would have to pay service tax only on 33 per cent of the value. Stung by new service taxproposals on property transactions, realestate bodies such as the Confederation of Real Estate DevelopersAssociations of India and Maharashtra Chamber of Housing and Industry plan toapproach the finance ministry to seek rollback of some proposals. Developers have already increasedprices by 15-20 per cent in the last nine months as demand for homes picked up.This resulted in demand tapering in January and February. Courtesy:- BS dt:- 04-March-2010 For more information regarding apartment in mumbai, bedroomapartments, buy property in india, commercial complex in india, commercial realestate, commercial space in mumbai, dealers, flats for sale, indian real estateinvestment, investment options in real estate, luxurious flats, malls, officespace, office space in mumbai, online real estate, penthouses mumbai, plots,property consultants, property in mumbai, property india, property investment,real estate company, real estate developer, real estate mumbai, real estate inindia, real estate investment strategies, real estate market, real estate news,real estate portals, realtors, realty, residence, residential real estate, sellproperty, shop, villas, Residential Apartment   Visit    www.zameen-zaidad.com             www.propertycafeteria.com  

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