Budget 2013 proposes urban housing fund, luxury homes to cost more
immovable properties are usually undervalued and underreported. One-half of the transactions do not carry the PAN of the parties concerned.
"With a view to improve the reporting of such transactions and the taxation of capital gains, I propose to apply TDS at the rate of one percent on the value of the
transfer of immovable property where the consideration exceeds Rs 50 lakh," he added.
Reacting to the proposals, leading realty consultant Jones Lang Lasalle India said the Budget for 2013-14 is tepid for the real estate sector, but was a moderately encouraging in general.
"The rate of abatement on homes and flats of above 2,000 sq ft or costing Rs 1 crore and above has been reduced from 75 per cent to 70 per cent. Effectively, this translates into an increase in service tax outflow, which means that luxury housing will now become even more expensive," Jones Lang LaSalle India Chairman & Country Head Anuj Puri said.
The setting up of the Urban Housing Fund by the NHB will infuse liquidity for urban housing, thereby boosting demand.
"The TDS of 1 per cent to be charged on the transfer of immovable property is an obvious move to curb speculation and bring about improved reporting and accountability in high-value immovable property transactions," Puri said.
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