There has been several positive Measures that would define the Real Estate prospects in the country.
This would not only bring positive Change in the sector but also define the Future of the Industry
To Start with the First change we would see that the nominal tax on ready but unsold inventory is to be charged after one year. This means that the person holding the land in a given real estate project will have to pay ‘tax on gains’ once the entire project is completed and not before that. Earlier, the price of the land was evaluated by the owner at the time of entering into a contractual agreement with a builder; and the taxable amount on the notional gains had to be paid on the assessed price at that point only. As the tax payment will be deferred, more land owners will be encouraged to tie up with developers and realtors. This will propel the supply of properties in the positive direction, further benefiting buyers.
Finance Minister Arun Jaitley in his Budget 2017-18 speech has given one of the much needed thrust to the Indian real estate sector. The minister announced that the ‘Affordable Housing’ will be given ‘Infrastructure’ status, which is likely to result in increased participation from private players.
Jaitley also announced that National Housing Bank will refinance individual loans worth Rs 20,000 crore in 2017-18. “NHB allocation will give a big push to affordable Housing Finance Companies namely AU housing, Gruh Finance, Repco,” said India Ratings.
On the all-important front of personal income tax, the existing tax rate for incomes between Rs. 2.5 lakh to 5 lakh has been reduced to 5%, and taxpayers in other categories will also save Rs. 12,500.
Jaitley also announced that National Housing Bank will refinance individual loans worth Rs 20,000 crore in 2017-18. “NHB allocation will give a big push to affordable Housing Finance Companies namely AU housing, Gruh Finance, Repco,” said India Ratings.
On the all-important front of personal income tax, the existing tax rate for incomes between Rs. 2.5 lakh to 5 lakh has been reduced to 5%, and taxpayers in other categories will also save Rs. 12,500.
Key highlights for real estate sector in Union Budget 2017:
* Affordable Housing has been given the Infrastructure status
* 1 crore rural houses will be created by 2019
* National Housing Bank to refinance Rs 20,000 crore loans
* Pradhan Mantri Awas Yojana to get Rs 23,000 crore
* Real estate developers to get tax relief on unsold stock as liability to pay capital gains will arise only in the year a project is completed
* Instead of Built up area of 30 and 60 sq meters, the carpet area of 30 and 60 sq meters will be applicable for affordable housing
* Holding period for capital gains tax for immovable property reduced from 3 years to 2 years
* Window for availing 3 year profit-linked incentives for start ups increased to 7 years against 5 years earlier
* Tax break of 1 year post receipt of the completion certificate, for the unsold stock
* New FDI policy under consideration.
* No cash transaction above Rs 3 lakh will be allowed
* Rs 2.41 lakh crore has been allocated to boosting infrastructure for transportation
* Indra Awaas Yojana will be extended to 600 districts
* Total allocation for the infrastructure sector is Rs 3,96,135 crore
* Allocation for National Highways to be at Rs 64,000 crore
* No cash transactions above 3 lakh
* Indexation for capital gains shifted from 01-04-81 to 01-04-2001
The criteria for low cost / affordable housing has been changed from built-up area of 30 / 60 sq mtrs to carpet area of 30/60 sq mtrs, thus making the low cost – affordable housing segment more lucrative for the builders and also making the segment more attractive for the buyers. With the change in criteria from built-up area to carpet area, the purchasers get more spacious homes and the builder is able to market the property to a larger segment of buyers.
Also the tax break of 1 year post receipt of the completion certificate, for the unsold stock, gives a slight breather to the builders.
Reduction in Income tax rate for basic slab: Will help broaden the tax net and also increase the disposable income in the hands of the tax payers coming within the category. This, coupled with the incentives on low cost housing and the reduction in interest rates by banks, is likely to promote thrust in the affordable housing segment.
Flying Sharks
(Inputs from Economic Times)
This would not only bring positive Change in the sector but also define the Future of the Industry
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| Ferrocement Casting Technique |
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| Ferrocement Temple Structure |
Jaitley also announced that National Housing Bank will refinance individual loans worth Rs 20,000 crore in 2017-18. “NHB allocation will give a big push to affordable Housing Finance Companies namely AU housing, Gruh Finance, Repco,” said India Ratings.
On the all-important front of personal income tax, the existing tax rate for incomes between Rs. 2.5 lakh to 5 lakh has been reduced to 5%, and taxpayers in other categories will also save Rs. 12,500.
Jaitley also announced that National Housing Bank will refinance individual loans worth Rs 20,000 crore in 2017-18. “NHB allocation will give a big push to affordable Housing Finance Companies namely AU housing, Gruh Finance, Repco,” said India Ratings.
On the all-important front of personal income tax, the existing tax rate for incomes between Rs. 2.5 lakh to 5 lakh has been reduced to 5%, and taxpayers in other categories will also save Rs. 12,500.
Key highlights for real estate sector in Union Budget 2017:
* Affordable Housing has been given the Infrastructure status
* 1 crore rural houses will be created by 2019
* National Housing Bank to refinance Rs 20,000 crore loans
* Pradhan Mantri Awas Yojana to get Rs 23,000 crore
* Real estate developers to get tax relief on unsold stock as liability to pay capital gains will arise only in the year a project is completed
* Instead of Built up area of 30 and 60 sq meters, the carpet area of 30 and 60 sq meters will be applicable for affordable housing
* Holding period for capital gains tax for immovable property reduced from 3 years to 2 years
* Window for availing 3 year profit-linked incentives for start ups increased to 7 years against 5 years earlier
* Tax break of 1 year post receipt of the completion certificate, for the unsold stock
* New FDI policy under consideration.
* No cash transaction above Rs 3 lakh will be allowed
* Rs 2.41 lakh crore has been allocated to boosting infrastructure for transportation
* Indra Awaas Yojana will be extended to 600 districts
* Total allocation for the infrastructure sector is Rs 3,96,135 crore
* Allocation for National Highways to be at Rs 64,000 crore
* No cash transactions above 3 lakh
* Indexation for capital gains shifted from 01-04-81 to 01-04-2001
The criteria for low cost / affordable housing has been changed from built-up area of 30 / 60 sq mtrs to carpet area of 30/60 sq mtrs, thus making the low cost – affordable housing segment more lucrative for the builders and also making the segment more attractive for the buyers. With the change in criteria from built-up area to carpet area, the purchasers get more spacious homes and the builder is able to market the property to a larger segment of buyers.
Also the tax break of 1 year post receipt of the completion certificate, for the unsold stock, gives a slight breather to the builders.
Reduction in Income tax rate for basic slab: Will help broaden the tax net and also increase the disposable income in the hands of the tax payers coming within the category. This, coupled with the incentives on low cost housing and the reduction in interest rates by banks, is likely to promote thrust in the affordable housing segment.
Flying Sharks
(Inputs from Economic Times)
The
nominal tax on ready but unsold inventory is to be charged after one
year. This means that the person holding the land in a given real estate
project will have to pay ‘tax on gains’ once the entire project is
completed and not before that. Earlier, the price of the land was
evaluated by the owner at the time of entering into a contractual
agreement with a builder; and the taxable amount on the notional gains
had to be paid on the assessed price at that point only. As the tax
payment will be ..
The
nominal tax on ready but unsold inventory is to be charged after one
year. This means that the person holding the land in a given real estate
project will have to pay ‘tax on gains’ once the entire project is
completed and not before that. Earlier, the price of the land was
evaluated by the owner at the time of entering into a contractual
agreement with a builder; and the taxable amount on the notional gains
had to be paid on the assessed price at that point only. As the tax
payment will be ..
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