REALTY INDUSTRY EXPECTS BOOSTER SHOT IN BUDGET

NAREDCO state president says both developers and buyers hope for reforms like tax sops and correction in prices

The realty sector, which is struggling to recover from the COVID-19 pandemic and the subsequent economic slowdown, expects a booster shot in the annual budget for 2021-22 to be presented by Finance Minister Nirmala Sitharaman on Monday. The government is expected to provide more support on the tax front, including a Goods and Services Tax (GST) waiver for homes under construction given its backward-forward linkage in the economy, especially in the affordable segment. National Real Estate Development Council (NAREDCO) state president Ashok Mohanani said both developers and buyers hope for reforms like tax sops and correction in prices, which will further benefit and stabilise the industry. “The industry expects if 1% GST for affordable housing can be extended for another fiscal along with the removal of Rs 45 lakh cap, it will surely be a great deal for the affordable housing segment. From the perspective of first-time home buyers, we expect the full benefit of interest to taxpayers should be provided. Reintroduction of GST with input tax credit on under construction properties will generate the demand amongst homebuyers,” he noted. Apart from the extension of the current benefits, HDFC Securities, in its research report, expects relaxation in registration charges, lower stamp duties and easing income tax norms might also augment the housing sales across the country. Increased allocation for Pradhan Mantri Awas Yojana (Urban), extension for the PMAY’s credit linked subsidy scheme for middle income group till March 2022 and extension of tax holiday for affordable housing projects till March, 2022 will help as well.