BUDGET-2017 REACTIONS from Pune builders

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ATUL GOEL- Managing Director- Goel Ganga Developers (I) Pvt. Ltd.

As was expected, the Budget emphasised on Housing for all.  The infra status to affordable housing is a well-come move which will give access to an easy and affordable finance. The tax benefit for affordable housing and long term capital gain reduced to two years is an indicator that government has taken housing concerns seriously. Another gem of decision is of giving tax benefits to houses of 30 to 60 Sq m, which is a great incentive for developers to promote affordable housing coupled with credit based interest subsidy schemes for finance upto 9 lakhs and 12 lakhs.

The parallel economy should be discouraged as it promotes corruption and spoils the status of construction industry hence we support demonetization. We all need to support government. As rightly said by Finance Minister who highlighted that our society is largely a non-tax complainant, hence we all need to work towards a formal economy which speaks of development of all. By giving such incentives it will encourage new tax payers.

In a nutsell, the overall budget is for poor and farmers.



CREDAI’s Budget expectations emanated from the national objective of housing for all by 2022 as well as the tremendous potential of housing to add to GDP and contribute to welfare. We are happy to note that the Budget has fulfilled long standing some demands of the real estate sector
1) Affordable Housing has been declared ‘Infrastructure’ with all its associated benefits. This has been a long standing demand of the real estate sector which would draw best private sector companies to affordable housing.
2) Additional refinance of Rs. 20,000 crore from NHB and lower interest rates resulting from increased liquidity in the banking sector would add to the funds for the sector at lower costs to the ultimate consumers.
3) The new Credit-Linked Subsidy Scheme for Middle Income Group with allocation of Rs. 1000 crore in the budget for 2017-18, would operationalize the interest subvention of 4% on home loans up to Rs. 9 lakh and 3% on home loans up to Rs. 12 lakh announced by Hon. Prime Minister on December 31, 2017.
4) Instead of counting the built up area of 30 and 60 square meters as eligible for profit linked income tax exemption, it will now be carpet area of 30 and 60 square meters which would be eligible for tax exemption. Further, 30 square meter would apply only for municipal limits of 4 metros and elsewhere it would be 60 square meters.
5) For joint development agreements, the liability to pay capital gains would arise only after project completion.
6) Tax on notional rental income of vacant property would be levied only after the end of year in which completion certificate is received. This would give developers time to liquidate their inventory.
7) Long term capital gains tax benefits on housing could be availed after 3 years has been brought down to 2 years. Real estate sector as an asset class would gain as a store of value.              
8) This budget will boost generation of affordable housing, generation of employment & investors in real estate sector.
9) It will accelerate growth of housing sector in totality, infrastructure, manufacturing.
10) It will enhance investment in real estate sector.