Finance Minister Nirmala Sitharaman has announced income tax relief for developers and home-buyers in order to boost the demand for residential real estate in the country, as part of Atmanirbhar 3.0 stimulus measures to push economic growth. The first-time buyers of houses costing up to ₹ 2 crore will get income tax relief of up to 20 per cent and this will be available till June 30, 2021. “This will incentivize people to buy homes and bring down the excess inventory,” Nirmala Sitharaman said.
The Finance Minister announced doubling the differential between circle rate (stamp duty value) and agreement value (purchase value) for primary sale of residential units of up to ₹ 2 crore, from 10 per cent to 20 per cent. “The government has decided to increase the differential from 10 per cent to 20 per cent under Section 43(CA) of the IT Act till June 30, 2021,” the finance minister said, adding that necessary amendment to the income tax act will be made in due course. As a result, buyers of these units will get tax relief of up to 20 per cent under Section 56(2)(x) of IT Act, she added.
“The move is a win-win for both developers and homebuyers. It will help reduce the high inventory, reduce the cost of acquisition for homebuyers. Real estate prices in many pockets of India have remained subdued, declined in some cases, a higher difference will help address this issue,” Krish Raveshia, CEO ,Azlo Realty.
Finance minister also announced a ₹18,000-crore additional outlay for the urban housing scheme to help complete real estate projects. ” ₹18,000 crore would be provided over and above the Budget Estimates for 2020-21 for the Prime Minister Awas Yojana (Urban) through additional allocation and extra budgetary resources,” Nirmala Sitharman announced. This will over and above ₹8,000 crore already provided this year. The move will help start work on 12 lakh houses as well as complete 18 lakh houses.
“This will help bridge the housing gap in the country to a good extent and is simultaneously an excellent economic growth driver by creating more employment,” said Puri.
“Five years after the implementation of this ambitious scheme, Pradhan Mantri Awas Yojana (Urban) has made steady progress across states. As of August 2020, a total of 1.06 crore homes had already been sanctioned in the country, of which 33% or approx. 35.18 lakh homes are completed while another 66.23 lakh units have been grounded for construction,” he explained.
Mean-while, India on Thursday recorded 47,905 news cases of the coronavirus disease which pushed up the overall tally to 86,83,916, according to a Union health ministry update. The number of new fatalities recorded was 550 after which the death toll reached 1,28,121.
Union health minister Harsh Vardhan interacted with chief ministers, state health ministers, principal secretaries, and additional chief secretaries of seven states where districts have a higher Covid-19 positivity rate. These states are Maharashtra, Uttarakhand, Manipur, Mizoram, Tripura Meghalaya, and Goa.
