NAREDCO i.e. National Real Estate Development Council recently urged the Central Government to rationalize GST [Goods and Service Tax] on the real estate sector and also asked to cut down stamp study under the purview of GST and incentivize rental housing in the upcoming union budget of 2019-20.
Niranjan Hiranandani, president, NAREDCO said that the Indian real estate sector is witnessing a rough phase and this is because of some reforms that were introduced by the Government themselves in the last two years. The council also suggested multiple actions to improve liquidity and to rationalize GST for under-construction properties as it will prove helpful to the sector at large.
Hiranandani further said that our main demand is to rationalize GST rate on the under-construction properties by slashing it to 8% from 18%.
National Real Estate Development Council also said that in order to increase the supply of dwelling units we suggest to avail services of the companies that are already in the business of renting houses under Section 80IBA. The council also suggested a hike in deduction limit from rental income under Section 24(a). This deduction should be 50% which is 30% for the general category at present and 100% for handicapped persons, women and senior citizen.
Rajeev Talwar, chairman, NAREDCO said that the scope of Section 80IBA of IT Act 1981 that allows a deduction equal to 100% of profits and gains generated out of the affordable housing project, should be increased by bringing all categories of affordable housing under its purview.
According to the memorandum, 80IBA should also incorporate projects that are sanctioned on or after the 1st June 2015 that is when PMAY was introduced inspite of 1st June 2016 that is prescribed.