2017 -18 had a lot for the real estate sector – it started off with demonetization and was later hit hard by the Real Estate Regulation and Development Act (RERA) and the Goods and Service Tax (GST). However, now the air around this entire thing seems to be getting better and the expectations from the government have increased for the coming year.
Put straight – The real estate developers were in all hopes that the government would rationalize the Goods and Services Tax slab for properties that are under construction and bring the stamp duty within the purview of the GST in the Interim Budget 2019.
Further, wishes were that the government should initiate steps for the creation of a stressed asset fund in order to effectively deal with the issue of incomplete projects and provide an EMI holiday to those whose houses have been facing undue delays.
It was only last year for the first time that the home buyers had sent their wish list for Budget 2018 to the finance minister. In this they had demanded that the government bring the real estate sector under the domain of GST as ensure that the builders pass on all benefits of input tax credit to the buyers. They had also called for an amendment to the Bankruptcy Code 2016 and designating home buyers as primary and secured creditors.
As per the Interim Budget laid yesterday, “For real estate in general and housing in particular, this is a positive Budget. Finance Minister Piyush Goyal has given tax breaks, enhanced benefits while not increasing taxes – and yet, has shown a roadmap that will keep fiscal deficit in control,” said Niranjan Hiranandani, president, NAREDCO.
“Affordable housing continues to get an impetus with benefits under Sec 80(i)BA being extended for one additional year, for housing projects approved till the end of 2019-2020. Homebuyers will also benefit from the rollover of capital tax gains being extended to investment in two residential houses, for an individual having capital gains up to Rs 2 crore,” said Nimish Gupta, MD, RICS South Asia.
Even though the previous years for the real estate sector were tough with some tough calls being taken, there are high hopes from this one and something to satisfy the demands of the homebuyers.