Businessmen who have sold plots in the industrial estates of MIDC may soon receive a visit from the taxman. For these transactions, the central GST administration is now collecting 18% duty.
The transactions are treated as leases, which are subject to GST because they are considered services. Since the introduction of the GST in 2017, all such transfers have been subject to the tax demand.
Since July 2017, information on these transfers has been gathered by the Directorate of GST Intelligence (DGGSTI), which fights duty evasion.
The initial allotment made by MIDC is GST-free. However, the land becomes taxable if the original allottees continue to lease it to third parties.
