The government is planning to simplify the Goods and Services Tax (GST) by introducing two main tax rates—5% and 18%—and a special 40% rate for luxury and ‘sin’ goods. This new system is expected to replace the current tax structure by Diwali 2025. But will this change make it easier for people to buy homes in Greater Noida West? Experts say it could lower costs, but it depends on whether developers pass those savings to buyers or keep them to boost their profits. Let’s break it down in simple terms.
How Does GST Affect Real Estate?
Right now, different materials and services used in building homes have different GST rates:
Cement: 28%
Steel, ceramic tiles, paint, and sanitary ware: 18%
Services like architectural design: 18%
These taxes increase the cost of building homes, which affects the price you pay for a 2 BHK, 3 BHK, or 4 BHK flat in Greater Noida West. The new GST plan would put most goods and services under either 5% or 18%, which could reduce construction costs. For example, if cement’s GST drops from 28% to 18%, developers could save a lot.
How Could This Help Home Buyers?
Cheaper Homes:
Currently, under-construction homes in Greater Noida West have a 5% GST (1% for affordable housing), while ready-to-move-in homes with an occupancy certificate have no GST.
The new GST rates could lower costs even more, especially if materials like cement and steel get cheaper. Experts say this could reduce overall taxes by 10% to 20%, making apartments in Noida Extension more affordable.
Affordable housing (homes up to 60 sq.m in metro cities or 90 sq.m in non-metros, priced up to ₹45 lakh) might keep its low 1% GST, helping first-time buyers.
More Transparency:
Lower taxes could encourage more transparent property deals in Greater Noida West. This means fewer cash transactions and more deals through official channels, making buying a home safer and more reliable.
Will Developers Pass on the Savings?
While lower GST rates could reduce costs for developers, it’s not guaranteed that they’ll lower home prices. Some might keep the savings to increase their profits. Vikas Bhasin from Saya Group says reduced GST could make homes more affordable and boost the real estate market in Greater Noida West. Pradeep Aggarwal from Signature Global agrees, saying a simpler two-slab system will make it easier for developers to manage taxes, improve cash flow, and potentially lower home prices.
However, Abhishek Kumar from SahajMoney warns that developers might hold onto the savings instead of passing them to buyers, so the price drop might not be as big as hoped.
Impact on Luxury Homes
For luxury flats in Greater Noida West, like those in Godrej Majesty, high-end fittings might fall under the new 40% GST rate for luxury goods. This could increase costs for buyers looking for premium 3 BHK or 4 BHK apartments.
What Experts Say
Lower Costs: Cheaper materials could make 2 BHK and 3 BHK flats in Noida Extension more affordable.
Transparency: Lower taxes could lead to more open and trustworthy property deals in Greater Noida West.
Challenge: If developers don’t share the savings, home prices might not drop much.
Final Thoughts
The proposed 5% and 18% GST slabs could make homes in Greater Noida West more affordable, especially for affordable 2 BHK and 3 BHK flats. However, the real benefit depends on whether developers pass on the savings to buyers. If you’re planning to buy a flat in Noida Extension, this change could mean lower prices and more transparent deals. For expert guidance, connect with trusted consultants like Kapur Infratech to find your dream home in Greater Noida West.