Realty for industry status

Realty for industry status

Last Updated: Friday, March 2, 2012, 15:42
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Realty for industry status New Delhi: Property consultants and real estate developers have demanded industry status to the realty sector in the forthcoming Budget.

They have also sought incentives to promote affordable housing segment and an increase in the tax exemption on home loans.

To boost supply, they have also asked for a single-window clearance for real estate development projects and FDI in multi-brand retail to create demand for retail space in shopping malls.

"Grant industry status to real estate, since the sector is a major driver for economic growth and generates countless jobs across its various verticals and associated industries," Global Property Consultant Jones Lang LaSalle India Chairman and Country Head Anuj Puri said.

He also pitched for relaxing norms for repatriation of FDI in real estate to attract more investment in the sector.

One per cent interest rate subsidy provided by the government for loans towards affordable housing should be "amplified and broadened" to include a wider price band of budget housing to benefit home buyers.

Expressing similar views, another property consultant DTZ said that the ceiling of housing loans eligible to priority sector lending should be raised in view of high property rate.

That apart, DTZ suggested increase in tax exemption on home loans to stimulate end user demand, particularly for mid-range housing.

"Principal repayments should be treated as a separate tax exemption entity and excluded from benefits under section 80C... Deductions towards the total interest payable on the home loan should also be increased from existing cap of Rs 1.5 lakh," it added.

Currently, an individual is entitled to claim both the interest and principal components of home loan repayments for tax benefits. The ceiling under tax benefits is capped at Rs 1.5 lakh towards the total interest payable on the home loan and Rs 1 lakh for principal paid.

Confederation of Real Estate Developers' Associations of India (CREDAI) requested the government to incentivise affordable housing segment and address the issue of high land cost and taxation issues.

"The prices of houses in urban areas are becoming unaffordable by the day under the onslaught of high land prices, rising cost of construction and high taxation... We would like the FM to re-introduce some measure like the erstwhile 80I(B) to give tax exemption for affordable housing," CREDAI NCR President Pankaj Bajaj said.

First Published: Monday, February 27, 2012, 15:17
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