Mumbai, February 28: MCHI-CREDAI, voice of the developer community, is pretty disappointed that FM did not grant the much-deserved industry status to the real estate sector. The real estate sector has time and again been deprived of the industry status. This will really hurt the sector as developers will find it difficult to obtain funds from banking institutions, thereby hampering their project and expansion plans.
However, we appreciate finance minister’s announcement of to allow additional deduction of Rs. one lakh for the first time home buyers of houses costing below Rs. 25 lakhs and the overall hike in tax exemption up to Rs. 2.5 lakh of interest on home loans. But this provision is just not enough as in Mumbai and Thane area one cannot buy flat below 25 lakhs. There is nothing in this budget for Mumbai real estate market.
Further provision of adding TDS at the rate of one percent on immovable property exceeding Rs. 50 lakhs is de-motivating and this will lead to rise in the property prices.
Long time demand of scrapping service tax in the real estate sector has not been considered in the budget and it has been further increased. To conclude this there has been nothing for the sector especially for the Mumbai and its surrounding areas.