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Realty sector upbeat on I-T exemption
Our Bureau
Mumbai, Feb. 29 Realty majors found cause to cheer the budget on concessions extended to other sectors.
Mr Ravi Ramu, Director, Puravankara Projects Ltd, said reverse mortgage proceeds not to be treated as income tantamount to a tax free pension for home owners post-retirement and should provide a fillip to home builders, since owning a home in old age has now become more attractive from a return, and an old age financial security perspective.
The introduction of a right of set-off of dividend distribution tax paid by a direct subsidiary of a parent company with the DDT paid by the parent will be a large benefit to real estate companies who have, or intend setting-up subsidiaries.
Construction costs are expected to come down due to duty and Cenvat reduction. The housing sector will take a boost due to the increase in income-tax exemption limit and new tax slabs will increase affordability of EMIs.
“The realty sector will also benefit as IT SEZs stand to gain due to non-extension of tax exemptions currently available to Software Technology Parks (STPIs) as the new investment in IT sector will now come into IT-SEZs,” said Mr Sanjay Chandra, Managing Director, Unitech Ltd. “The long-awaited demand for industry status for the real estate would have gone a long way in providing the desired impetus to the growth of the sector which is highly capital intensive,” said Mr Pradeep Jain, Chairman, Parsvnath Developers. “A tax benefit under Sec 80 I (B) for hospitals is a paradigm change and we expect a new generation health technology entering into Tier-II and III cities. The sops given to infrastructure and housing sector in rural areas is a welcome move, however, the reduction in duties and service tax benefits directly to consumers would have propelled the demand for realty. The reduction in input cost of cement, steel etc will definitely benefit the sector,” Mr Jain said.
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