GST on FSI Charges: Concerns from Real Estate Developers

The Confederation of Real Estate Developers Associations of India (CREDAI) and the National Real Estate Development Council (NAREDCO) strongly oppose the proposed 18% GST on Floor Space Index (FSI) and additional FSI charges, arguing it will significantly increase housing prices by approximately 7-10%.

This increase in project costs, they contend, would negatively impact housing affordability, reduce demand, and potentially stall ongoing projects, jeopardizing the financial security of homebuyers and contradicting the government's 'Housing for All' mission.

Developers highlight the already high development premiums, raw material costs, and labor expenses, asserting that adding this GST would make affordable housing projects economically unviable and severely hinder the sector's growth, impacting over 300 related industries.

CREDAI and NAREDCO urge the government to reconsider the proposal, emphasizing that retrospective application of this tax would create substantial unforeseen liabilities for developers and further destabilize the real estate market.