NAREDCO Pushes for Major Reforms in Real Estate Ahead of Union Budget

The National Real Estate Development Council has proposed significant changes to tax policies, interest deductions, and GST rates to stimulate growth and support the 'Housing for All' initiative in India.

The National Real Estate Development Council (NAREDCO) has submitted a series of recommendations ahead of the Union Budget to invigorate the real estate sector in India. These proposals aim to tackle existing challenges and spur growth, aligning with the government's 'Housing for All' mission.

NAREDCO highlighted the issue of notional income tax on properties held as stock-in-trade for more than two years, suggesting an extension to five years. The organization also recommends comprehensive reforms in the tax policies, including raising the limit of interest deductions on home loans from Rs 2 lakh to Rs 5 lakh.

Additional recommendations include removing the cap on setting off house property losses under Section 71 or increasing it to Rs 5 lakh, and offering builders a choice between concessional GST rates without input tax credit (ITC) or higher rates with ITC. These changes are aimed at improving cash flow for developers and making homes more affordable for the lower and middle-income population.

NAREDCO's proposals also call for revising the criteria for affordable housing to focus solely on carpet area without a price cap, accommodating higher land prices in metro cities. If adopted, these measures could provide relief to developers and stimulate demand, ultimately advancing the government's goal of 'Housing for All', says G Hari Babu, President, NAREDCO.

(With inputs from agencies.)