GST council met for discussion on real estate related issues and took following decisions:

1. GST on flats other than affordable housing flats would be 5%

2. GST on affordable housing will be 1%

3. Definition of affordable housing is as under:

1. 1. In terms of cost, any house up to Rs. 45 lakhs

1. 2. In terms of size, for metro cities– carpet area up to 60 square meter and other places, 90 square meter

1. 3. Either one of the conditions have to be met, that is, house having carpet area of 50 square meter valued at Rs. 50 lakhs will be taxable at 5% and not 1%

4. Builders for above types of residential projects will not be eligible to claim input credit

5. Transferable Development Rights (TDR) / Joint Development Agreements (JDA) / Long Term Lease Premium and FSI transfers shall be exempted only in case it pertains to a taxable residential project. In other words, TDRs for commercial projects will be taxable @ 18%

6. Above changes will be effective from 1.04.2019 onwards after notifications are issued.