Hyderabad: The Telangana state government has sought exemption from service tax for the affordable housing segment under the GST regime.
It brought to the notice of the Centre the state government’s plans to implement affordable housing schemes for the poor and lower-middle class and argued that the service tax under the GST regime will have a negative impact on the affordable housing segment.
The government has taken up the 2BHK housing scheme for the poor on priority basis. Already it has accorded approval for the construction of 2.70 lakh 2BHKs across the state including GHMC areas for which tenders have been invited and are in various stages of finalisation.
A fresh approval to construct 1,000 2BHKs in each of the Assembly constituencies except GHMC limits has been accorded.
The government has also lined up plans to construct affordable houses for the lower middle and middle classes in cities and towns.
Given this, the government wants the Centre to exempt service tax on affordable housing under the GST regime.
Finance minister Etela Rajender said, “If service tax is imposed, it will impact the affordable housing segment. On the one hand the Centre and state governments are implementing 'housing for all' schemes and if service tax is imposed it will adversely affect these projects. Contractors will not come forward to take up works for affordable housing schemes.”
He added that the government will raise the issue at the next meeting of the GST Council.
