Budget 2023 expectation: Realty industry wants tax and policy related relaxations

With a view to sustain demand in the housing sector, the realty industry wants tax and policy related relaxations in the upcoming Budget. With interest rates rising, a lot depends on Budget 2023 to support and sustain the housing demand.

"The government should rationalise GST rates for construction materials like steel, cement and tiles. Additionally, the government should put aside more funds under the stress fund SWAMIH.

"Policies should be relaxed, or scope of policy should be widened so that stuck projects can be completed. Subsidy under the Credit Linked Subsidy Scheme (CLSS) has been a big saving and motivation and should be continued to achieve the "Housing for All" mission. The RBI needs to be vigilant in its adjustment of the repo rate. A minor increase in repo rate is a corrective measure which will offset future negative impacts of inflation. Hence, we look at this scenario with pragmatic optimism and approach the market with a bullish perspective," said Pradeep Aggarwal, Founder & Chairman, Signature Global (India Ltd.

Manoj Gaur, President, CREDAI, NCR, and CMD, Gaurs Group, said that real estate contributes 6-8 per cent to the GDP and employs more than five crore people.

"It has high hopes from the forthcoming budget. To begin with, there should be a separate deduction for principal repayment as currently clubbed under section 80(c). It should be raised from the existing Rs 1,50,000 limit. There is also a need to redefine affordable housing from the current ceiling of 45 lakhs in urban and 30 lakhs in non-urban areas to take into account the inflationary factors," he said.

Gaur also said that the carpet area should also be increased to 90 sq mt in the metros and 120 sq mt in non-metro cities without any price cap.

"Long-term capital gains on capital assets should also be taxed at 10 per cent. The holding period should be reduced to 12 months in line with the holding period of other capital assets like listed equity shares and equity-oriented mutual funds," he added.

Nayan Raheja of Raheja Developers said that the Finance Ministry should take stock of the insolvency debts of realtors and delays in project deliveries.

"The Budget should focus on alleviating the real estate sector from ongoing problems. The Finance Ministry should take stock of the insolvency debts of realtors and delays in project deliveries. The Budget should introduce tax remissions on the interest rates of home loans levied by banks which have been triggered by the all-time high inflation rates in previous quarters. This will provide relaxation to developers and simultaneously pace up the construction activity on ongoing projects," Raheja said.

Aman Sharma, Director at Spaze Group, said that strong and healthy consumer demand is the crucial driver of the growth of the real estate sector today.

"The Budget should reflect upon the aspirations of developers who are still tiding over the turbulence caused by the pandemic. The most crucial demand is to give tax relief to developers to expedite the completion of stalled projects and take a compassionate recourse in times of difficulties," he said.

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