Union Budget Impact Analysis on Real Estate Sector by ICRA

Buildings

Accommodation Times Bureau

 

According to the ICRA’s report on Union Budget’s impact on Real Estate Sector, following are the key points of the result of the anlaysis.

·    Infrastructure status for affordable housing would enable developers to access wider pool of financing at lower cost

·    With various incentives announced for affordable housing segment; ICRA expects participation by organized players in this segment to increase

·   Projects targeting middle income group could benefit from incentives . Tax benefits would increase the returns to project developers

·   ICRA expects that the availability of tax exemption will spur many developers in the organized sector to enter the affordable housing segment

·  PMAY credit linked subsidy programme expected to play a key role in enhancing affordability

·  Clarity on tax implications of JDA for land owners will facilitate ease of developing projects under this mode

·  The changes to long term capital gains tax calculation for immovable property will enhance the appeal of immovable property as asset class with greater flexibility

·  Tax rule change targeting “thinly capitalized” entities availing income tax benefits of debt instruments will have negative impact on cash flows of developers.

For full report, please refer to the appended report file.

Union Budget Impact Analysis- ICRA

 





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