“The budget 2017 was supposed to be a very critical affair post demonetization as far as the realty market was concerned. There were huge expectations from the Finance Minister Mr. Arun Jaitley and he showed some positive hopes for industry going forward” reckons Mr. Chintan Sheth, Director, Sheth Corp.
The first positive from the budget was the proposal of tax relief to developers on unsold inventories. The second important point was the reduction of long term capital gains tax period from 3 years to 2 years which will provide relief to both investors and developers. Also, the tax liability for developers involved in the joint development agreement will arise only in the year of selling the property. These benefits can further be transferred to the buyers by reducing their financial burden while purchasing their dream home.
Affordable housing constitutes the largest demand from home buyers and the Government has already reflected in the budget with the policies geared towards that end. It has allocated Rs. 23000 crore for the Pradhan Mantri Awas Yojana (PMAY) and plans 1 crore houses for the poor by 2019. Also, the granting of infra status to the affordable housing segment will mean lower borrowing costs for the sector and thus addresses the margin issues that private players in this segment face. These initiatives will boost the affordable housing segment and will help in Government’s mission of “Housing for All”.
There is no change in excise and service tax rates due to upcoming GST. Introduction of GST will help in curbing multiple taxes which is a positive sign for the industry and result in buyers coming forward to buy property, added Mr Sheth.