The GST Council, in its 33rd meeting held on 24 February 2019, approved a set of major recommendations aimed at reviving the residential real estate sector and improving housing affordability. Acknowledging the sector’s significant contribution to GDP and employment, and the slowdown affecting under-construction housing projects, the Council recommended sharply reduced GST rates on residential properties. It approved an effective GST rate of 1 percent without input tax credit (ITC) for affordable housing and 5 percent without ITC for residential properties outside the affordable segment, with effect from 1 April 2019. Affordable housing was clearly defined based on carpet area and property value, with differentiated limits for metropolitan and non-metropolitan cities. To ease cash flow pressures on developers, the Council recommended exemption from GST on development rights, joint development agreements, long-term lease premiums, and floor space index, limited to residential properties on which GST is payable. The Council also noted that the detailed operational framework for implementing these recommendations would be finalised by an officers’ committee and placed before the Council for approval. The proposed changes were expected to benefit homebuyers through lower prices, remove disputes relating to non-passing of ITC benefits, simplify tax compliance for builders, and address the issue of accumulated and unutilised ITC. In addition, the Council decided that the issue of GST rates on lottery would require further deliberation by a Group of Ministers. These recommendations were to be given legal effect through subsequent notifications and circulars.