Budget 2019 expectations: From income tax exemption to House Rent Allowance, what real estate sector wants from PM Modi
Budget 2019: On account of IL&FS crisis hitting the Indian realty to a larger extent as the money flow almost dried up for both developers and the home buyers, the wish list of the Indian realty has grown longer. From smooth credit line to industry status, here are the list of wishes that the realty insiders have put forward before the Narendra Modi government. The Finance Minister of India will stand in Parliament on February 1 to present the Budget 2019. Since Budget usually determines how most industries are likely to perform through the year, the real estate sector presents its expectations:
Challenges in real estate
Considering the current set of challenges in real estate, while efforts have been made to streamline most processes, the 2019 budget could do a lot more. Changes such as creating a Single Window Clearance system, bringing Real Estate under GST, and tightening RERA rules to strengthen investor sentiment would be very welcome. These coupled with raising the personal income tax exemption limit for interest on home loans and rental income would be much to the advantage of home-buyers and the sector as a whole. (Pixabay)
Single tax structure in GST
Although GST has been introduced in real estate, it still requires further rationalization as additional levies like stamp duty and registration are still separately charged. They should be included within a single tax structure. Lowering the GST slab on under-construction properties to 5 or 6 percent from the existing 12 percent would usher in a lot of positive movement in the sector. (PTI)
Income tax rebate
Rebate under Section 80C
Tax on unsold properties
Liquidity for developers
House Rent Allowance
Tax deduction on home loan interest
Allow tax deduction on home loan interest in the under-construction phase of the apartment. Currently, it can only be claimed at the completion of construction in five equal installments and that also is subject to Rs. 2 lakh limit. Allowing deduction in the under-construction phase will be make houses more affordable for people especially in the current scenario when liquidity pressures on developers have elongated the construction period. (Reuters)