Tax burden up: Now, LDA flats to cost more with GST
Homebuyers will have to deposit instalments at the enhanced tax rate of 12%.lucknow Updated: Jul 31, 2017 17:23 IST
Flats of Lucknow Development Authority (LDA) will cost more with goods and services tax (GST). Now, instead of the 4.5% tax, homebuyers will have to pay 12% tax.
However, the development authority has offered a relief window for its customers. Allottees whose instalments were due on June 30 or earlier can deposit these at the old tax rate of 4.5% till August 10.
After the expiry of this window, homebuyers will have to deposit instalments at the enhanced tax rate of 12%.
This means that while an allottee had to pay Rs 4,500 tax on every instalment of Rs 1 lakh, he/ she will have to shell out Rs 7,500 more under GST. “The effective increase will be 7.5%,” said Jai Shanker Dubey, secretary, LDA.
The cost of LDA houses at its prestigious CG City project on Sultanpur Road, and ongoing projects at Gomti Nagar extension, Kanpur Road, Kursi Road and Priyadarshini scheme will also go up.
The development body is also concerned about the proposed auction of its commercial properties scheduled for August 9, as these too will cost more now. LDA officials are apprehensive about the success of the auction in terms of revenue generation.
“The cost of commercial properties of the development authority will go up under GST. In such a scenario, we are not sure if the proposed auction on August 9 will be successful,” said a senior LDA official.
The one-day auction of properties will take place at LDA’s Gomti Nagar office.
From commercial plots to shops and halls, the LDA will uction a wide range of its commercial properties. The development authority has uploaded its list of properties approved for auction on its website www.ldaonline.in.
The decision is aimed at helping LDA dispose of its commercial properties and replenish its empty coffers. However, now officials feel that higher rates will dissuade potential buyers from participating in the bidding process.