Small flats to become cheaper
People dreaming to buy small flats have good news as Finance Minister AMA Muhith, in his budget speech yesterday, proposed lower value added tax (VAT) for flats up to 1100 square feet.
In place of the even rate of 3 per cent VAT for the building construction sector, the finance minister proposed different slabs of tax for flats of different sizes.
As a result, in the 2015-16 fiscal, prices of smaller flats are set to come down while the prices for bigger flats, however, would go up.
For building construction sector, instead of the existing VAT rate of 3 per cent, I propose to impose VAT at the rate of 1.5 per cent for flats having floor space up to 1100 sq feet, at the rate of 2.5 per cent for flats having floor space between 1101 sq feet and 1600 sq feet, and at the rate of 4.5 per cent for flats having floor space of more than 1600 sq feet, Muhith told the House.
