No Incentives for Affordable Housing

The Union Budget 2015-16 become disappointing for Real Estate Sector as Industry was hoping that the budget will incentivise the developers for creating affordable housing besides various reliefs in taxation and reduction of rates for home loan to revive the sluggish market. The only comfort to be derived from real As Union Govt has set a target to create 6 crore new housing units by 2022 particulary 2 Crore in urban and 4 crore in rural Area to provide shelter to every houseless people. To create such huge housing stocks, the role of private participation are very much essential. Thus, incentivise to take a proactive and to create such huge housing stocks . However such target can Due to sluggish demand some housing projects are facing cash flow issues besides industry are facing uncertainty over land acquisition, delay in approval processes which remain unaddressed.

The impact for increase of service tax from 12.36 to 14% are going to increase the housing cost marginally. There is a minor concession to Real Estate Investment Trusts, which allows pass through of rental income for income tax purposes and projects a regime for capital gains tax on them.

Hence, the Union Budget, in treating real estate with neglect, leaves the current problems of real estate where they are. All one can hope is now to see the lower interest rate regime materialize quickly and in good measure.

D.S.Tripathy

Joint Secretary, CREDAI National