Rationalisation of FDI and taxes, uniformity and reduction in stamp duty rates, infrastructure status for the hospitality industry and reduction in home loan rates are some of the major demands of the real estate sector.
With the Budget round the corner, the country?s real estate sector, which has been recording phenomenal transformation and growth, and has seen a series of reforms during the last few years, is asking for more now.
According to Anuj Puri, chairman and country head, Jones Lang LaSalle Meghraj, ?There are still some policy issues that need to be addressed and the most important of these should not be viewed in isolation, but in the context of the continuum of changes.?
?There is a need to further rationalise FDI to below the threshold built-up area of 50,000 sq metres. Real Estate Investment Trusts (REITs) should be facilitated apart from granting fiscal incentives for adopting sustainable practices and constructing green buildings. It is imperative to rationalise dividend distribution tax (DDT) which was increased from 12.5% to 15% as it affects the real estate funds as the dividends have to be paid with higher tax incidence. Also, there should be uniformity and reduction in stamp duty rates. That, apart from granting infrastructure status to he hospitality industry, would boost the sector.?
The Confederation of Real Estate Developers Association of India (Credai) has recently made a pre-Budget representation to the finance ministry stressing the need for promotion of rental housing to create a supply of mass accommodation. As per the recommendation, all income on rental from houses below 150 sq metre houses should be exempted from income tax and service tax apart from scrapping of the ceiling on holding houses for the purpose of long-term capital gains tax.
Credai also wants the Reserve Bank of India to take housing industry as a priority sector for lending purposes. For this, the association wants substantial reduction in home loan rates and project finance interest rates.