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  1. Budget 2017: Tax breaks, GST crucial for real estate sector, says Sandip Somany of HSIL Ltd

Budget 2017: Tax breaks, GST crucial for real estate sector, says Sandip Somany of HSIL Ltd

With less than 10 days to go for the Union Budget 2017, real estate industry is expecting the Narendra Modi government to take certain measures like "providing tax breaks and infrastructure status to boost the sluggish demand of this sector."

By: | New Delhi | Published: January 27, 2017 2:26 PM
With less than 10 days to go for the Union Budget 2017, real estate industry is expecting the Narendra Modi government to take certain measures like "providing tax breaks and infrastructure status to boost the sluggish demand of this sector." (Reuters image) With less than 10 days to go for the Union Budget 2017, real estate industry is expecting the Narendra Modi government to take certain measures like “providing tax breaks and infrastructure status to boost the sluggish demand of this sector.” (Reuters image)

With less than 10 days to go for the Union Budget 2017, real estate industry is expecting the Narendra Modi government to take certain measures like “providing tax breaks and infrastructure status to boost the sluggish demand of this sector.” “The real estate sector had been sluggish since the past few years but the recent move by the government to clean the system and flush out unaccounted money through demonetization has slowed it down further,” Sandip Somany, VCMD, HSIL Ltd said. Banking on the crucial Goods and Services Tax (GST) Bill, Somany hoped that the bill will be passed during the upcoming session. “To support their mission of ‘Housing for All by 2022’, we expect the government to drive housing demand for middle class income group by bringing down the interest rates on home loans and increasing the exemption limit for home loan interest,” Somany said.

A few days ago, Godrej Group Chairman Adi Godrej has said the government should not “interfere” in the real estate sector, often cited as one of the biggest black money generators, even as he termed demonetisation a “positive step”. “No. Nothing,” he replied when asked if he thought that the government needs to do something as some argue that real estate and gold are among the biggest generators of unaccounted wealth. “You cant interfere in the business,” Godrej told PTI in an interview.

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Earlier, property developers and consultants were predicted that the real estate sector, particularly resale market, would be adversely impacted in terms of pricing and demand following demonetisation of Rs 500 and 1,000 notes. The experts, however, opined that the move by the government will help improve transparency in the industry that has a reputation of being a safe haven for black money.

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Industry players had termed the last year’s Budget proposals as positive for the real estate sector, saying that tax sops for first home buyers and incentives on development of affordable housing projects will help revive demand in the sluggish property market. Some of them, however, rued that their demand to provide industry and infrastructure status to the realty sector was not considered. The Budget 2016-17 had proposed an additional Rs 50,000 deduction on interest on loans for first home buyers and 100 per cent deduction for profit on development of affordable housing, besides exempting REITs from dividend distribution tax.

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