Budget 2018: The government has put the housing sector on the trajectory of growth with special emphasis on affordable housing. In the Budget for 2016-17, tax concessions were given to the developers of the affordable housing projects. Further, in 2017-18, infrastructure status was granted to affordable housing. Recently, the Goods and Service Tax (GST) rates on affordable and low-cost housing have been reduced. These measures have increased the confidence of stakeholders and also increased investment in housing sector. Budget 2018-19 has announced the establishment of a dedicated affordable housing fund in National Housing Bank, funded from priority sector lending shortfall and fully serviced bonds authorised by the government. This will make available low-cost long-term funds for affordable housing.
For PMAY (U), the Budget 2018-19 has provided Rs 6,500 crore through gross budgetary support and Rs 25,000 crore through internal and extra budgetary resources under the Ministry of Housing and Urban Affairs. This would further accelerate the fund availability for affordable housing. In case of capital gains, business profits and income from other sources in respect of transactions in immovable properties, where the transaction value is less than the circle rate, the taxable amount will be computed on the actual transaction value if the circle rate does not exceed the transaction value by more than 5%.This would facilitate speedier transactions under the ease of doing business with minimum government maximum governance.
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Focus on infrastructure and high outlay given to it would provide more opportunity to affordable housing in smart cities and semi urban areas. Real estate is the second largest employment generation sector in the economy. The proposal of setting up model skill development centres under the Pradhan Mantri Kaushal Vikas Yojana will help in skill development of construction workers with emphasis on area specific needs and locally available material, which would boost employment opportunities and enhance construction quality. The Swachh Bharat Mission whereby six crore toilets have been already constructed and the proposal to construct two crore more will definitely go towards increasing the overall standard of living.
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The statement that the government will consider agriculture as an enterprise is a welcome move along with measures to ensure that farmers get MSP and a price forecast mechanism under the aegis of the government and an agri market infrastructure fund (Rs 2,000 crore) have the potential to change the landscape of rural and agri economy. Boosting of farm incomes would also result in affordability of houses in rural areas. The National Health Protection Scheme would create a social security for the poor. Reform measures with respect to stamp duty on financial instruments is a welcome move and the government could consider extending it to real estate sector as well so that we can look at a relatively uniform stamp duty structure across the country. The National Housing Bank Act is being amended through the Finance Bill, 2018 to transfer its equity from RBI to government.