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The budget 2018 is pinning on everybody’s head, so is the case with real estate sectors. Real estate is ready with their wish- list on hand and expecting government to pay full justice to them. Top most expectation of their wish- list is deduction on GST rate. A buyer of under construction property faces an effective GST rate of 12% since it is considered as availing of services from the builder. Stakeholders’ wants government to increase more incentive to the sector in order to achieve PM Modi’s dream “Housing for All” by 2022.
In 2017 government introduced a series of reforms like RERA and GST for improvising the situation of economy but it little bit affected real estate on first half of year 2017 but later on it worked out. As everything has its advantage and disadvantage, real estate faced both of it and stood back with better launches and projects.
So with the effect of reforms in 2017, developers believe that 2018 is going to bring fruitful budget. Here are the different views of builders on GST-:
Real estate sector experienced many jolts in the year 2017. The real estate regulatory act (RERA) came into force in May 2017 seeks to protect the home-buyers, as for 2018-19 budget the entire sector expects transparency, accountability and to increase investor confidence in real estate market in long run. In the same year Goods and Service Tax (GST) was also implemented, which replaced multiple taxes. The fraternity expects positive results in 2018 with favourable terms and conditions which would work in the favour of both buyers and developers. To further promote the sector incentives should be given to the first time home-buyers which will definitely promote the real estate segment in the long run bringing smiles on the faces of the people associated with it. Focus should be given for the supply of ready-to-move-in properties as the developers are seen focusing on completing their existing projects. – Mr. Ravish Kapoor, Director, Elan Group
We are going to witness India's first post-GST, which might be the last full budget presented by the Current Government. The steps from last couple of budgets have boosted buyer’s sentiments towards the real estate sector and we hope this year will further enhance it. The assigned GST rate for the under-construction properties is 12%, which is higher than the previous taxes. The real estate sector expects a strive to make GST a tax-neutral proposition so as to help people associated with it and there is also a recommendation that stamp duty should come under the ambit of GST which increases the overall price of the property. - Mr. Pushpender Singh, Managing Director – JMS Buildtech Pvt.Ltd.
The Union Budget for 2017-18 fiscal is going to be presented soon by the Union Finance Minister. This is a time when financial markets around the world are not in the best health, so the sector expects greater attention to bring larger investment which will help in the development of the sector benefiting its end users and the country. The forthcoming budget may increase the standard deduction limit on rental income which may fulfill the dream of more people of owning a home. As of expectation, ready- to- move in will be given special preference because of the developers sustained focus on completing their existing projects. – Mr. Rahul Singla, Director, Mapsko Group
On the other hand developers want government to abolish stamp duty even after the implementation of GST as the rates are different in every state which causes increment in the cost of buyers.
Look our builders saying on abolition of stamp duty-:
Real estate is witnessing a challenging time presently, therefore, we are very hopeful for some measures that will bring relief to the sector. With the Union budget around the corner, the sector expects a decrease in the Stamp Duty as it increases the overall cost of the property. Section 80EE of the income tax Act, works in favour of the first time home buyers as it provides an added tax benefit of Rs 50,000 on the home loans sanctioned during the financial year 16-17, which should be extended this year as well, to refresh buyer sentiments. The sector is also expecting more clarification in terms of rates relating to GST for various properties including under construction. - Mr.Vineet Relia, Managing Director, SARE HOMES
The biggest demand of 2018 budget is to grant infrastructure status to the real estate sector, it will lead to construction fund being available to the developers at lower interest rate.
View point of BDI Group for granting infrastructure status-:
On February 1, Finance Minister Arun Jaitley is expected to present his last full year budget, for the 2018/19 year that begins April 1. It is expected that the budget will focus more on the infrastructure and housing sector to boost that country’s GDP. In the last year budget, affordable sector was given infrastructure status, with that we expect more for the segment to full the NDA government dream of Housing for all by 2022. The consumers expected consolidation of demand and over improvement in the market segment, in 2017 we expected that RERA will bring transparency, with GST to ease the sector, but unfortunately both these expectations were not met. In coming budget we expect the applicable GST on the real estate to come down and should also include reforms which will be in a favour of the developers and the buyers. - Mr. Ssumit Berry, Managing Director, BDI Group
The sector also expects reforms in land acquisition.