Real Estate Hopes for Budget Boost: Anuj Puri and Anshuman Magazine Share Insights
As the Union Budget is set to be presented on July 23, the real estate sector is eagerly awaiting measures to support its growth. Industry leaders have shared their expectations to boost demand, supply, and sustainability in real estate development.
Revival of Credit-linked Subsidy Scheme (CLSS)
Anuj Puri, Chairman of ANAROCK Group, suggests reviving the Credit-linked Subsidy Scheme (CLSS) under the Pradhan Mantri Awas Yojana (PMAY). This scheme, which ended in 2022, provided subsidies for Economically Weaker Sections (EWS) and Low-Income Groups (LIG) buying affordable homes. Puri believes that bringing back this scheme would encourage first-time homebuyers.
Tax Incentives for Developers
Puri also recommends reinstating the 100% tax holiday under Section 80-IBA of the Finance Act, 2016, to boost affordable housing projects. He suggests updating the definition of affordable housing to reflect current market prices, proposing an increase in the price cap from Rs 45 lakh to Rs 85 lakh in Mumbai and Rs 60-65 lakh in other major cities.
GST and Single-Window Clearance
The sector is urging the government to reduce the current GST rate of 12% or reinstate input tax credit (ITC) for under-construction properties. Additionally, introducing a single-window clearance system for real estate projects could reduce delays and improve business efficiency.
Enhanced Tax Benefits
Enhancing tax benefits under Section 24(b) and Section 80EEA would make home loans more affordable. Increasing deduction limits would encourage more investments in real estate, especially in the affordable housing segment.
Green and Sustainable Housing
Promoting eco-friendly housing through tax incentives and subsidies could address environmental concerns and foster innovation in construction. This could include tax rebates for developers using green practices and buyers investing in energy-efficient homes.
Infrastructure Status and Hospitality Sector
Granting infrastructure status to the real estate sector would help developers access funds at lower interest rates and streamline regulatory processes. The hospitality sector also hopes for tax reductions, infrastructure development, and tourism promotion in the Union Budget.
Additional Recommendations by Anshuman Magazine
Anshuman Magazine, Chairman & CEO of CBRE India, suggests increasing the tax deduction limit from Rs 1.5 lakh to Rs 4 lakh per annum and moving it out of Section 80C. He also recommends reintroducing tax incentives for real estate investment trusts (REITs) and expanding the criteria for affordable housing in metro cities.