Pre
Budget 2020-21
Very
genuine expectations of the Real Estate sector in the budget of 2020-21 by Dr
R. Kumar, Managing Director – Navin’s
With the economy in India facing a
downward spiral and more particularly the issues faced by the
struggling Real Estate sector which contributes nearly 8 to 10% of the
country’s GDP is expected to be given a lot of attention and encouragement in
the 2020 -21 budget, which can have multiplier effect in the other
sectors as well.
The following are the very genuine expectations of the Real
Estate sector in the budget of 2020-21.
Enhancement of the Income Tax
exemption limit of Rs.2 lakhs on the interest paid on housing loans under
section 24 of Income tax Act to a minimum of Rs.5 lakhs.
 |
| Dr R. Kumar, Managing Director,Navin’s |
Infact Government of India
would do well to completely lift the limits if possible as this will
encourage more and more people to invest in housing
Extension of PMAY for MIG Housing
The PMAY Scheme benefits for MIG
Housing units come to end on 31.3.2020. We expect the budget to extend the date
by two years to 31.3.22, coinciding with that of EWS and LIG.
Allowing back of Input Tax credit in GST for under
construction homes.
While reducing the GST on under
construction properties to 5%, Government of India had withdrawn the input tax
credit provisions. This has caused only more burden on the buying
public.
The 2020 budget is expected to bring
back the input tax credit for under construction properties by slightly
tweaking the 5% rate upwards.
This will be encouraged back to
invest in housing. It is also expected that budget would revive the option of
unbundling land value from flat sale price for calculation of GST.
Capital gains Tax Allowance:
Capital gains Tax deduction on
reinvestment of sales proceeds of property into housing is currently restricted
to one or two units.
This is discouraging landowners from
developing their property on joint development basis.
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