The interim budget by interim finance minister Mr. Piyush Goyal is largely people’s budget and Mr. Goyal and Hon’ble Prime Minister Narendrabhai have made a point that it has something for every stratum of Indian Life.
Here is my perspective for the Real Estate Relevance:
One of the biggest thought processes that I feel is the commitment made of ten trillion dollar economies over the next 13 to 15 years horizon as Real Estate equally plays a larger role into the Indian economy. This also confirms the predictions made by Real Estate experts that Real estate sector in India is expected to reach a market size of US$ 1 trillion by 2030 from US$ 120 billion in 2017 and contribute 13 per cent of the country’s GDP by 2025
Here is what we actually gained for Real Estate in Interim Budget 2019:
- Affordable housing: Good News, to make more homes available under affordable housing, the benefits under 80 IBA have been extended for 1 more year i.e. till 31st March 2020.
- Notional Rent: Income tax on notional rent is payable if one has more than one self-occupied house. Considering the difficulty of the middle class having to maintain families at two locations on account of their job, children’s education, care of parents etc, Finance Minister has proposed to exempt levy of Income tax on notional rent on a second self-occupied house.
- From Developer’s perspective – notional rent exemption period for unsold inventor has been proposed to be extended from one year to two years from the end of the year in which the project is completed.
- Relief for small taxpayers, the TDS threshold for deduction of tax on rent is proposed to be increased from 1.8 Lac to 2.4 lac.
- Last but not the least – Rollover capital gains benefit under section 54 will be increased from investment in one residential to two residential houses for a having capital gains up to Rs. 2 Cr. This benefit can be availed once in a lifetime. This is indeed a great step because for an example – if a person has home worth Rs. 1 Cr and sold at Rs. 3 Cr and again wish to buy not one but 2 properties then he can invest total of 3 Crore in to two different properties for the future security of kids or whatever the reasons may be.
This is a dream budget for the middle class and for farmers. With the increase in exempted income, increase in the standard deduction, an increase in the limit for TDS etc. we can expect more disposable income in the hands of the people.