Real estate industry has high expection on upcoming budget 2017-2018.The consumers are demanding that government has to give relaxation in income tax ,raise in House Rent Allowance(HRA) deduction and announce policise toimprove the real estate industry.Stakeholder demands from real estate Industry
PropTiger -Sunil Mishra Chief Business Officer -PropTiger
During the post demonetisation of 1000 -500 rupees , the real estate had severe impacted on sales , as potential buyers
thinks waiting for fall in the property prices and keep on postposting their purchase decision. We are expect
some confidence-boosting measures in the upcoming budget, which will put more money in people’s hand and that
will bring level back to home sales to demonetisation levels.As especially , the tax rate cute in middle-income groups
will be most awaited measures.
Hawelia Group– Rattan Hawelia
In upcoming budget 2017, policies on major construction material should be addressed so that cement and other supporting
industry can be controlled which is affecting the cost of housing to the end user.Moreover tax clarity on REITs should be worked on by the Government making it a viable tax structure and thus easing the investment options. All such policy reforms will give momentum to the struggling real estate sector and 2017 can be the year of remarkable progress in real estate.
JLL– Anuj Puri, Chairman & Country Head, JLL India
The government should increase tax deduction limit for housing loan which boost the real estate industry especially buyers in metropolitan cities. Right now the current limit of Rs 2 lakh is insignifiant for metropolitan cities like Delhi,Mumbai,Bangalore,Chennai etc and most of house more than one crores and Also, tax concessions on house insurance premiums could be introduced to encourage end-users to insure
their homes. Similarly, the tax exemption limit should be increased by about Rs. 1 lakh and be auto-set to match inflationary trends in a financial year. While the goods and services tax (GST) tax structure has been announced, the real estate industry is waiting with bated breath to see which tax rate is applied to the real estate and construction industry. Clarification would also be needed on the abatement scheme, and whether credit for input tax would be allowed if the composition scheme has been availed by developers.
Salaried persons get house rent allowance (HRA) as a component of their total salary, and can therefore claim a deduction.
This deduction can be substantial in cases where the salary and its HRA component are higher. However, self-employed persons
and those who draw lump sum pays without an HRA component can only claim a maximum deduction of Rs 2,000 a month under Section 80GG. The Budget can and should address this anomaly.
Royal Institution of Chartered Surveyors-Sachin Sandhir, Global Managing Director – Emerging Business, RICS
The real estate industry contribute about 15% of India’s GDP by directly or indirectly.The real estate sector contributes to over 15% of India’s GDP. The developer are forced to borrow at high interest rates and comply with a stringent evaluation process. Unavailability of funds at a reasonable rate of interest delays the construction process and increases the final cost of homes, negatively impacting the end consumer.Giving industry status to the entire real estate sector, instead of granting infrastructure status only to the affordable housing segment,would help in pushing the housing demand in India. We hope to see this announcement in the upcoming Budget.
For the real estate sector to really grow and execute its projects on time, various government approvals should be given in a timely manner.Developers have for long been demanding single window clearance to remove bureaucratic delays, which in turn delay delivery of homes.Research by RICS indicates that a single-window clearance system would drastically boost the real estate sector in India.We have not seen a single REIT listing till date because of the presence of multiple taxes. Until tax hurdles are removed for developers and asset holders, it is highly unlikely that we will see any REIT listing. The government should recognize the capacity of
REITs to improve market conditions for the real estate sector and remove the policies constraining their growth.
The government should look at:
*Reduced level of taxation of IT income
*Waiver of capital gains for the developer at the time of transfer of property into REIT.
*Removal of service tax on lease premises
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