Bengal’s reduction in stamp duty may not increase sales: Colliers International

tax1By Kunal Gandhi

Accommodation Times Bureau

The West Bengal government’s move, to slash stamp duty to 2%

from 6%-7% and the registration fee to 1% from 1.1%, may ease

the financial burden on home buyers but it may not be enough

incentive for buyers to purchase properties, according to Colliers

International. In its 2017-18 budget, the West Bengal government

has slashed the stamp levy to 2% from the prevailing 6%-7% and

the registration fee to 1% from 1.1%. In order to avail the benefit

of the stamp duty cut, the registration has to be done within a

period of four years from the date of agreement and payment of

the balance stamp duty. The focal point of the budget remained

the realty sector, which is facing an ongoing slump. It also offered

an additional 20% early bird discount in the registration fees, if the

property is registered within a year of completion. These

proposals will come into effect once the finance bill is passed in

the assembly in the last week of February 2017.

Kolkata’s real estate market, which is majorly an end-user- driven

market, has been going through a slump for the past two years.

Although the reduction in the stamp duty was a long standing

demand of the sector, it will not be enough to drive sales. In the

past, developers like Lord Realty and Eden Group, offered to bear

the cost of registration and stamp duty in their respective projects

to increase sales velocity. However, such offers were not enough

to lure buyers. Therefore, this move of reduction in the stamp

duty, will only have a marginal impact on the sale of properties.

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