The year 2017 was certainly an eventful year. The real estate sector in-particular went through a lot of turbulence due to the rolling out of demonetisation, the introduction of the Real Estate Regulatory Act (RERA) and the implementation of the Goods and Services Tax regime, said Khushru Jijina, Managing Director, Piramal Finance & Piramal Housing Finance.
Expressing his expectations on the upcoming Union Budget 2018 will be presented on February 1 by Union Finance Minister Arun Jaitley, Jijina said, “We want the budget to imply uniform GST on the complete real estate sector. The tax rate on certain affordable housing schemes is as high as 8 per cent. In a bid to ensure housing for all, it is important for the government to revise the GST on these schemes and lower it to 5 per cent.”
Hinting at the restricted tax exemptions on the first time home buyers, he added, “The Centre has restricted the incentives for the first time home buyers under 80EE for the properties valued at Rs 50 lakhs or lesser than that. The reality of prices exceeding this amount in most metro cities suggests that the limit can be increased such that benefit to first time home buyers is achieved in both letter and spirit.”
Year 2017 also restricted the loss from house proper to Rs 2 lakh that was unlimited earlier. This extensively truncated the demand and investment rationale used by second time home properties buyers who availed this option as income generating.