Post Budget Expectations From Mr. Getamber Anand, President, CREDAI National

Post Budget Expectations From Mr. Getamber Anand, President, CREDAI National

Post Budget Expectations From Mr. Getamber Anand, President, CREDAI National

In this year’s Union Budget, our Finance Minister has taken the right steps to boost housing and ensure that 'Housing for All by 2022' becomes reality. CREDAI welcomes the announcement, on the supply front for Private sector's participation and housing for all by 100% income tax exemption on such houses besides the MAT 30 sq m in metros and 60 sq m in non-metros. This will encourage the private sector to reach these areas that accommodate about 90% of the shortage. 100% exemption will actually increase the IRRs on such ventures. On the enabling side to the home buyers, the increment of a deduction of INR 50,000 on the home loan for a house of INR 50 lakh is a very big attraction. Moreover, there will be a net to net saving of 50,000 rupees a year for such home buyers. Considering there has been a 100% exemption of service tax on such houses as well. The increase of deduction on rent paid on a house from INR 24000 to INR 60,000 will also result in a saving of about INR 12,000 to INR 13,000 a year.

It is overall a very positive budget for the real estate sector and CREDAI is certain that this will spur the market and induce the home buyer who has been waiting ever since for some special incentives to actually be able to buy a house. Best part is that there is a timeline fixed for delivery of such affordable houses. All we ask for now is speeding up of the approval process as the whole project needs to be delivered in a time frame of about 3 years. So a single window clearance system of course would be a big enabler. Now the next task for CREDAI is to convince the state urban local bodies because by-laws are a state subject to increase the densities in their by-laws, to reframe the method of calculation of densities so that smaller units can be made in all projects.

Another important point is the rationalization of the income tax act and small pain-points which existed earlier and were contrary on the government's claim of 'ease of doing business' such as excise on RMC which is for captive use, has been positively addressed. This shows the government's intent to actually make ease of doing business a reality. So rationalization of the entire tax act will also be a big boost to the sector to step up supply of affordable housing.

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