Mumbai, with over 14,000 dilapidated buildings and 70 lakh residents living in slums, faces significant housing challenges. Redevelopment is crucial for addressing these issues by creating additional housing stock and improving living conditions. However, CREDAI-MCHI has raised concerns over the GST imposed on these projects, arguing that it adversely affects both developers and homebuyers. The non-availability of Input Tax Credit (ITC) has increased costs for homebuyers and slowed demand in an already sluggish market.
Mr. Domnic Romell, President of CREDAI-MCHI, emphasized the financial strain caused by current GST regulations, stating, “The GST implications on redevelopment and rehabilitation projects have placed an undue burden on both developers and homebuyers. We urge the government to reconsider these charges, particularly for projects involving the rehabilitation of slum dwellers and residents of unsafe, dilapidated buildings. The real estate sector, one of the largest employers in both organized and unorganized sectors, is crucial for economic revival. As Mumbai attracts top talent and faces rising housing demand, the city's geographic constraints hinder its ability to accommodate the growing population effectively.”
CREDAI-MCHI also highlights other pressing issues, including GST on Transfer of Development Rights (TDR) and the Rs 45 lakh limit for Affordable Housing benefits. Additionally, developers face costs for constructing both rehabilitation and sale buildings, paying GST at rates of 18% or 12% without ITC. Despite these costs, GST authorities have levied GST on the rehabilitation component of schemes, resulting in slum and dilapidated building occupants being required to pay GST on flats they already own. This levy is seen as anti-poor and contrary to the spirit of the GST regime, amounting to double taxation.
The organization advocates for greater flexibility, proposing that developers should have the option to choose between the 12% GST rate with ITC or the 5% rate without ITC. This flexibility would help ensure ITC cost savings are passed on to homebuyers while allowing developers to continue delivering large-scale affordable housing projects.
CREDAI-MCHI remains committed to working with the government to address these issues and drive growth in the real estate sector while ensuring the availability of affordable and safe housing for Mumbai’s residents.
ABOUT CREDAI-MCHI
CREDAI-MCHI is an apex body comprising members from the Real Estate Industry in the Mumbai Metropolitan Region (MMR). With an impressive membership of over 1800+ leading developers in MMR, CREDAI-MCHI has extended its reach throughout the region, establishing units in various locations such as Thane, Kalyan-Dombivli, Mira-Virar, Raigad, Navi Mumbai, Palghar-Boisar, Bhiwandi, Uran-Dronagiri, Shahapur-Murbad, and most recently in Alibag, Karjat-Khalapur-Khopoli, and Pen. Being the only Government-recognized body for private sector developers in MMR, CREDAI-MCHI is dedicated to promoting the industry’s organization and progress.
As a part of CREDAI National, an apex body of 13000 developers across the nation, CREDAI-MCHI has emerged as a preferred platform for regional discussions on housing and habitat by establishing close and strong ties with the government. It is committed to breaking barriers to create a strong, organized, and progressive real estate sector in the MMR.The vision of CREDAI-MCHI is to empower the Real Estate fraternity of the Mumbai Metropolitan Region as it preserves, protects, and advances the right to housing for all. To continue being a trusted ally, guiding their members, supporting the Government on policy advocacy, and assisting those they serve through the ever-evolving real estate fraternity.
Website: https://mchi.net/
For further media queries, please contact:
Sonia Kulkarni | 9820184099
sonia.kulkarni@hunkgolden.in
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