Budget 2019: What real estate sector wants Nirmala Sitharaman to do for commercial projects : 28-06-2019

Union Budget 2019 India: Even as slowdown keeps the sentiment of real estate sector down, Finance Minister Nirmala Sitharaman is expected to announce sops to revive it. The sector pins hopes on the budget for some sops in the form of tax benefits, reduced interest rates as well as along other incentives to pull up the sector. Along with further tax sops to both homebuyers and investors, the industry expects budget to come up with some policy changes.

In the case of commercial real estate projects, trading of FSI (Floor Space Index), Development Rights and TDRs (Transferable Development Rights) should be clarified to be in the nature of immovable property transfer and should consequently be outside the ambit of GST. Also, GST on rent and maintenance charges for F&B tenants should be relaxed as input credit is not available to them,” said Amit Khanna, CEO, InterGlobe Real Estate

Conversions from AIF (Alternative Investment Funds) to REIT should be allowed so as to boost greater retail investor participation in Real Estate as an asset class, he added

The sector also expects the budget to allow registration of projects under RERA with approved building plans.  “It is recommended that registration under RERA may be allowed once the basic or primary approval of building plans has been obtained by the promoter, with the secondary approvals such as height clearance  from Civil Aviation Authority or environmental approval from MOEF being covered under Section 4(E),” said Satish Magar, President, CREDAI National.

The average time for obtaining the secondary approvals is more than one year and this adds to the cost of the project and brings down affordability, he added.

Source : Economic Times