The caravan of new policies by the Government, such as, demonetization, GST and RERA have sent the Indian realty sector reeling.
Considering the situations and policies of the ruling BJP-led government since it came to power, budget housing tops the list of priorities of the government. India’s realty sector during the present era has been marred by a variety of initiatives like demonetization, goods and services tax regime (GST) and the introduction of Real Estate Regulatory Authority (RERA).
As the Finance Ministry clears the desk to declare its final full-scale Union Budget within the scope of the ruling government prior to the country goes to polls in 2019, it is believed that the government will try to make everyone happy with strategies targeting individuals and India Inc., also the real estate sector.
Here are a list of issues that are the cause of agony for the realty sector that the government could take up and resolve in the imminent Union Budget 2018-19:
The allowance and ratification procedure for home realty sector endeavors has been a stumbling block since years on end. Even though a large number of campaign activities have been appropriated to build a beneficial business habitat in the zone, the call for a single window authorization means in entirety still has a long way to see fulfilment.
If executed and enforced, a single-window clearance can very much bring down the all-round projects cycle time and builders can concentrate on crux of their business of project management. “Following RERA, it has become all the more important to facilitate smooth clearances and approvals so that there are no execution delays due to procedural hindrances,” added Anuj Puri, Chairman – ANAROCK.
Budget home sector saw a rise of 20% in the new project rollouts in 2017 in comparison to 2016 and this practice will carry on, according to Amit Ruparel, Managing Director, Ruparel Realty and hence, this year the government should focus on bringing the sector within the ambit of industry status in its entirety which will ascertain easier accessibility to organizational credit and boost reduction of developers’ cost of loaning for projects.
Remuneration for Green Buildings
Cost of building green constructions is high-priced and this is the reason that most of the builders shy away these type of projects. Considering India’s falling apart urban environment, Puri recommended that incentivizing green real estate project is the most wanted thing as of now.
“Keeping in view the current and certain future challenges to the environment, the Government should encourage developers with higher incentives in terms of FSI and/or some degree of tax exemption to encourage them to adopt green building technologies,” he shared.
Ruparel as well as Puri have asked the government to lower the existent GST rate, which will promote the buyer belief in the sector. At present, a GST of 12% is imposed on a half-done property which is substantially more than the prior tax rate.
“Additionally, stamp duty and registration charges are outside the ambit of GST, hope in this budget, the government subsumes these levies into GST,” Ruparel added.