The real estate industry had got a huge push for the government in Budget 2016 with Finance Minister announcing several schemes which will support the real estate industry.
Here some what some of top real estate developer body CREDAI had to say regarding the budget.
1. Dharmesh Jain, Chairman & Managing Director, Nirmal Lifestyle & President MCHI – CREDAI said, “Emphasis on infrastructure and affordable housing is the key highlight in this budget which in turn will create demand. Government’s announcement on spending 2,21,246 crore on infrastructure is definitely a big move. Government announcing no service tax for houses under 60 square metres in non-metros and under 30 square metres in metros is a welcoming move but it would have been great if the size of these houses would have been uniformed for both metro & non metro cities . Abolishing DDT on income from REITs is also a good move in this Budget. All-in-all, it is a growth oriented budget for real estate”, Dharmesh Jain, Chairman and Managing Director, Nirmal Lifestyle & President MCHI”
2. Gaurav Gupta, General Secretary, CREDAI RNE said, “The budget is a balanced and a growth oriented budget. Strong Push has been given to affordable housing by incentivising developers of 100% Income Tax exemption on construction of houses up to 30 sq meters in metros and 60 sq meters in non metros. With a proposal of zero service tax on this, it will go a long way in creating enough housing stock where demand actual exists. Developers too will be motivated to construct as Income tax exemption is a must in thin margin affordable housing projects. By introducing an additional deduction of Rs 50,000 on interest for loan up to Rs 35 lakh, Finance Minister has given some reason to cheer to the first time home buyers. A major relief is that no excise will be levied on RMC produced at the construction site. Demand for industry status, raising limit on Interest repayment from Rs 2 lakh to Rs 4 lakh remain unheard which was looked upon with high hopes from the entire sector.”
3. Manoj Gaur, President CREDAI NCR said, “Union budget 2016 has focused on some key issues which is positive for real estate sector. In some major declarations made in the budget regarding affordable housing, it is clear that government is keen to give a boost to affordable housing segment, being also in lined with government’s initiative to provide housing to all by 2022. 100% Service tax exemption has been given to make houses up to 30 sq mtr in 4 metros and up to 60 sq mtr in others. We believe that his policy for affordable segment will benefit the home buyers, especially the middle and lower income group. Increased tax rebate to 60000 will benefit those living in rented houses in a big way. Certain issues related to direct and indirect taxes have been addressed which is good. The biggest disappointment was that the real estate did not get the infrastructure status which was long pending demand of this sector.”
4. Deepak Kapoor, President CREDAI Western UP said, “The budget has brought relief to the housing sector; however, overall expectations of the realty sector were high which have not been met. In a move to boost the housing demand, deduction of Rs 50,000 has been given on a loan of up to 35 lakhs. There has been allocation of funds for infrastructure development which includes construction of road networks and setting up of 300 urban clusters. Affordable housing has been given a fair share. This would kick start the real estate in Tier 1 and Tier 2 cities along with new mushrooming areas in major cities as well. Direct Dividend Tax (DDT) is now exempt from REITS. This was very much required to make REITS efficiently functional. Much to our disappointment, Industry status and single window clearance system could have been the biggest game changing reforms for real estate sector which were not even mentioned in the budget.
5. Suresh Garg, Secretary, CREDAI Western UP said, “There have been slew of reforms which have been taken up in this budget session. Real estate too has got its share from the budget but still there are few demands which are waiting to get a final nod. To boost affordable housing which is in line with the government objective to provide housing to all, tax exemptions have been given. DDT is also now exempt from REITS which is a positive announcement for realty sector. Rent-payers and first time home buyers have also been considered and their tax deduction limit has been enhanced. These measures will benefit realty sector in a big way but still a lot was expected from budget which was not fulfilled.”