G_Rider

A workshop on tax matters in Real Estate was recently organized by Confederation of Real Estate Developers Association of India (CREDAI) NCR Chapter whereby duties applicable on real estate sector such as customs duty, service tax, VAT, central sales tax, entry tax, municipal/ local taxes, stamp duty and registration charges along with other key issues of concern were discussed by CREDAI NCR members in great detail.

The key issues that were discussed included service tax liability for a developer of residential complex, eligibility of CENVAT credit on construction services used in relation to renting of immovable property, inputs used for applicability of new rate of 4% under Composition Scheme of Works Contracts, classification of Composite Contracts under construction services or work contract service.

Service tax issues in budget 2008 gained prime focus of discussion. In particular service tax rate being maintained at 12%, threshold limit of exemption for small service providers being increased from 8 lakhs to 10 lakhs, 7 new services being brought under the service tax net, extended scope of existing taxable services, composition rate of service tax for works contract services being increased from 2% to 4%, service tax is now required to be paid on transaction with associated enterprises either on receipt of payment or making credit/ debit entries in the books of accounts whichever is earlier, expansion of scope of renting for use in the course of furtherance of business were points of discussion.

According to CREDAI NCR President Mr. Pradeep Jain, “The announcements made in the budget for the year 2008-09 are indicative of the developments expected; the budget however has not addressed much awaited demands of giving industry status to the sector. Along with others CREDAI NCR has also put forth views and suggestions before the Ministry of Finance through various forums and will continue to pursue the issues with the government on behalf of the industry.”

He further added that the spiraling prices of steel and cement have been another area of concern for CREDAI and the issue has been taken up with the concerned by sending representations.
Along with a number of issues concerning Real Estate sector major services such as commercial & industrial construction services, construction of residential complex services, execution of works contract services etc. were also taken up for discussion for understanding the implications for industry.

CREDAI NCR has gone a long way to establish its footage of covering more than 80% real estate developers in Delhi and NCR. It has been emerging as a leading platform for addressing problems of real estate developers of Delhi and NCR and uniting them under one roof. As an organization CREDAI NCR believes in performing as a catalyst for improving the social and economic infrastructure.