Union Budget 2016 was filed within the lower house from the parliament amidst great expectations from industry leaders along with the common man. Finance Minister Arun Jaitley delivered an inexpensive which catered to the farmers and poorer parts of the society. Small tax payers were also given some relief.
The minister began presenting the cost by proclaiming that there was clearly nine pillars on what his budget stood. From the real estate perspective the pillars which will enjoy the most direct effect on this sector will be infrastructure and tax reforms.
Over all Union Budget 2016 looks like it’s a mixed bag to your realty industry. Although some expectations were addressed, some went totally ignored. A demand which was met is definitely the digitization of land records that could result in dispute free titles. In the Digital India Initiative, the nation’s Land Record Modernisation Programme is anticipated to be revamped and can come into effect from April 1st, 2016. This may bring the required transparency to the realty sector.
Here can be a detailed check out what the budget been on store for any realty sector.
Infrastructure: Infrastructure was given a leading thrust through this budget. Special attention was given to road related infrastructure. This spells good news for that realty sector for the reason that continuing development of this industry is dependent upon the employment of quality transport related infrastructure.
Here include the key infrastructure related announcements from Budget 2016:
- 85% of road projects that have been languishing get home on track
- INR 97,000 crores have been make time for to your road sector
- 10,000 km of National Highways into the future up in 2017
- 50,000 km of State Highways for being changed to National Highways
- Total outlay of INR 2.18 lakh crores for rail and road
- Total outlay of INR 2,21,246 lakh crores for infrastructure
- 160 airports and airstrips being revived
Tax reforms:?The tax slab has been left untouched which is most significant disappointments of Budget 2016. But small tax payers have already been granted a rise rebate. Some good news for the real estate property sector was also over the cards when it comes to REITs, affordable housing and the rental segment.
Here are probably the important tax reforms from Budget 2016:
- Those who bring home below INR 5 lakhs sees an increase in rebate from INR 2000 to INR 5000
- HRA deduction goes up to INR 60,000 from INR 24,000
- First time homebuyers to savor deduction on an additional interest of INR 50,000 on home as many as INR 35 lakhs in case the valuation of the property won’t rise above INR 50 lakhs
- 100% deduction for profits to a undertaking at a housing work for flats upto 30 sq. metres in four metro cities and 60 sq. metres in other cities, approved during June 2016 to March 2019
- Service tax exempted on affordable homes which measure under 60 sq. m
- Dividend Distribution Tax on Real estate Trusts (REITs) has become removed
- Withdrawal as high as 40% from National Pension System to generally be tax exempted
- 100% deduction of profits for 3 beyond Several years for startups build during April 2016 to March 2019