Budget 2020 Expectations: Realtors demand ease in taxation from Nirmala Sitharaman
Budget 2020 Expectations: Finance Minister Nirmala Sitharaman is getting ready to present the Union Budget 2020 on 1st February 2020.
Budget 2020 (#BUDGET2020ZEE) Expectations: Finance Minister Nirmala Sitharaman is getting ready to present the Union Budget 2020 (#BUDGET2020ZEE) on 1st February 2020. If the government is busy finalising its budgetary proposals for FY2020-21, captains of the Indian economy are also forwarding their lists of demands. In this queue, real estate developers have also come forward and aired their demands. They want FM Sitharaman to provide ease in taxation norms for the real estate sector. Industry insiders are of the opinion that it would help the Modi Government to rationalise personal and other forms of taxation and boost the sector and the national economy.
Speaking on the need for ease in taxation in real estate Dr. Niranjan Hiranandani, National President at NAREDCO said, "There are provisions, which create genuine hardships to real estate developers, who are already under pressure in the on-going sluggish market. Real estate industry is already struggling with large unsold inventories. Taxing notional rent (Section 23(5) of the Income Tax Act), after one year from the end of the financial year in which completion certificate is received from the competent authority, will lead to severe financial implications for the developer/industry. It may also lead to no new projects being launched, if sales remain low, which in turn will defeat the mission of the Government to provide Housing for All by 2022."
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Satish Magar, President at CREDAI — National chapter said, "Over the last few years in India, the real estate sector has to cope with institutional changes including RERA, GST and IBC. The fall in the growth of GDP from trend rate of 8 per cent to around 5 per cent has also adversely affected the demand side in real estate. This is because homes are a part of discretional expenditure by households. Equally, a decline in the rate of GDP entails a downward adjustment in demand for shops and offices. The growth seized of the need to take direct measures for the revival of the real estate sector as a part of measures to boost GDP growth." Magar said that the change in IBC, setting up of stressed funds are amongst the steps in the recent past intended to spur the investments in the real estate sector. The budget 2020-21, therefore, would provide the government an occasion to boost the real estate demand as also continue to encourage private sector investment particularly in affordable housing, in line with the objective of ‘Housing for All by 2022’.
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