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Union budget 2017 real estate sector

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The relaxation in the area measurements under the Tax exemption scheme is welcome steps and will amplify the interest of developers to build those kinds of projects even in city limits. There is disappointment with no announcement on increase of home loan interest deduction and investment linked deductions. The clarity on taxation of Joint Development Agreement should really benefit the land owners and real estate developers and shall result in more deals getting concluded thereby increasing housing supply. The move to reduce the tenure of the Long-Term Capital Gain tax from 3 years to 2 years is extremely welcome…

Vipul Shah
Managing Director – Parinee Group

The Union Budget 2017 has ensured that sanitation is one of the to ppriorities for the government in the next financial year. The budget has proved that a constraint of funds will not impede infrastructure activities and the vision for a clean India. The allocation of`23,000 crore for the Pradhan Mantri Awas Yojana to reach the goal of 1 crore homes for the homeless by 2017 is one of the best points from the budget.The construction of more homes will provide an impetus to the sanitary ware industry, and increase the demand for products. The increase in allocation of funds for MGNREGA, and target to increase the involvement of women under the scheme is commendable…

Renu Misra
MD of Grohe India

Government’s proposal to take into consideration the carpet area of 30 and 60sqmt instead of built-up area of 30 and 60sqmt (as was the case earlier) of the houses is a welcome step, whereby 30sqmt limit will apply only in case of municipal limits of 4 metropolitan cities, while for the rest of country, including the peripheral areas of metros, limit of 60sqmt will apply.This will allow developers to plan their future projects within the 60sqmt carpet area, which will boost the housing sector immensely. Additionally, the Finance Minister’s proposal to extend the completion period of building of houses from the present 3 years to 5 years is logical and commonsensical. In case of joint development agreements signed for development of property, the liability to pay capital gain tax will arise in the year the project is completed.Landlords now need not fear that they will be required to pay their taxes at the time of the transfer of land, rather it will be required at the time of the completion of the project. Further, after completion of the project, developers can sell their unsold inventory within one year, post completion of the project without being subjected to any incometax liability…

JC Sharma
Vice Chairman & MD, Sobha Limited

Reduction in Income Tax rates both for earners up to `5 Lakhs and MSME’s, will help in increasing their purchasing power and shall also impact demand for affordable housing positively. More importantly,the simplification of rules qualifying affordable housing, tax holiday under 80 IBA and infrastructure status to this segment are significant positive moves by the government. Reduction in homeloan rates has already proven to be beneficial for housing demand…

Abhishek Lodha
MD, Lodha Group

The positive aspects include there visions to capital gains tax through reduction in holding period from 3 years to 2 years; Payment of capital gains by landlord on Joint Development agreements in the year of completion is revision of Built-up area to Carpet area; the according of Infrastructure status to the Affordable Housing;and extension of period for carrying forward the MAT Tax from the existing 10 years to now 15 years. Fiscal deficit for 2017-2018 has been estimated at3.2% of the GDP which may lead to a lower borrowing programme, this is an excellent move and will go a long way to meet the country’s growth objectives.We were anticipating encouraging announcements for the industry and in the light of the upcoming RERA and GST implementation, we expect renewal of consumer confidence in the sector…

Ashish Puravankara
Managing Director, Puravankara Limited.

Real estate Investment Trusts (REITs) will open ways for the realty sectorto get easy funding and ensure timely completion of projects. From ourperspective, it would be beneficial if home buyers can come under thelowest possible slab of the GST,thereby, enabling greater affordability for potential home buyers…

Rahul Shah
CEO, Sumer Group

A positive step is additional refinance of `20000 crores through NHB. Further, the permission to complete Affordable Housing Projects in five years instead of three years to qualify for Tax exemption in 80IB is a relief. The new Credit Linked Subsidy Scheme for Middle Income Group with allocation of `1000 crores in the Budget will also revive the demand. The benefit to individual taxpayers by raising exemption limit and slab restructuring benefit would also boost purchasing power and demand…

R K Arora
Chairman, Supertech Ltd

The announcement to abolish Foreign Investment Promotion Board will make it easier to get foreign funding through the automatic routes. Tax free profit for five years for affordable housing developers will give more time to builders to finish projects. The government has redefined “affordable housing”, which is important in a country like India with varied markets. The allocation for infrastructure is substantial at over `3,90,000 crore. It has provided`2.4 lakh crore for transport sector,including railways, road and shipping.Allocation for national highways has been stepped up to `64,000 crore from Rs 57,676 crore…

Sachin Sandhir
Global Managing Director-Emerging

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