Budget wish list
Increased tax benefits on home loans needed to boost sales
With the real estate sector facing a liquidity crisis and homebuyers burdened with high interest rates, developers and experts have proposed that tax benefits on home loans be increased to boost sales and infrastructure status be accorded to affordable housing in this year’s budget.
Increasing tax benefits on home loans: High interest rates — varying from 10.25 to 11.5% — are a deterrent. Currently, an annual exemption of up to R1 lakh is allowed on home loan interest.
Realty experts point out that when the exemption clause was introduced apartment prices were at least 40% lower. The exemption limit should, therefore, be doubled, they say.
The deduction for principal repayment of housing loans under Sec