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Union Budget
"Budget 2016 was a mixed-bag for the real estate industry" reckons, Mr. Chintan Sheth
Posted On : 2016-03-02 22:57:45( TIMEZONE : IST )
"The budget 2016 was supposed to be a very crucial affair for the realty market. There were huge expectations from the Finance Minister Mr Arun Jaitley but the result was a mixed-bag if the real estate industry was considered" reckons Mr Chintan Sheth, Director, Sheth Corp.
The first positive from the budget was the exemption of DDT (Dividend Distribution Tax) from REITs. The DDT which is currently 15% was a major obstruction for the investment in REITs. Now we can expect a major chunk of investments flowing in the sector.
The other good thing in the budget was that the Service tax has been exempted for housing construction of houses less than 60 square metre i.e 645 square feet approx. This will help buyers who already had additional burden on them with various taxes. Also the First home buyers will get an additional deduction of interest of 50,000 provided value of house does not exceed Rs 50 lakh. The Finance Ministry has proposed 100% deduction to undertakings for construction of affordable housing. These initiatives will boost the affordable housing segment and will help in Government's mission of "Housing for All".
The Finance Ministry would pursue the implementation of GST before the Parliament. 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.
Though there were few good announcements to be mentioned, but the major ones were overlooked, added Mr Sheth.
The single window clearance has not been taken into consideration. There is not a proper roadmap for the real estate bill which was the most awaited and discussed topic last year. The bill will boost the entire industry and will definitely prove to be a game changer for the market. The impact of this bill will be profitable to both consumers as well as builders as it will bring transparency in the industry and confidence amongst buyers.
