States would be advised to lower the stamp duty on residential properties to about 2-3 per cent
Sarbajeet K. Sen
Moumita Bakshi Chatterjee
New Delhi, Sept. 13
IN what could lead to substantial easing of property prices across the country, the draft National Housing and Habitat Policy, 2005, has proposed to bring down stamp duties on residential properties to 2-3 per cent in all States. At present, stamp duties are as high as 10-13 per cent in certain States.
To promote investment in housing, the draft policy also proposes to accord `infrastructure' status to housing for funding and concessions. The Ministry of Urban Employment and Poverty Alleviation is piloting the policy.
"States will be strongly advised to bring down and rationalise the scale of stamp duty. While maintaining some difference between residential and non-residential properties, States would be advised to bring down the stamp duty on the former to about 2-3 per cent. Provisions in the Indian Stamp Duty Act, 1899, would be made accordingly and the Government orders, directions, circulars and rules framed by respective State governments would be reviewed within a specific timeframe," according to the draft.
A new Land Policy has also been mooted for easier acquisition of land for use by private developers.
"Considering the specific requirements of housing and urban infrastructure projects, both in public and private sectors, a land policy would be drawn up. Even though the provision has been made in the Land Acquisition Act 1894 to acquire land for private companies, the provision has not been used so far in the interest of the real estate developer," the draft has said.
The land policy is expected to provide statutory support for land assembly, pooling and sharing arrangements. The draft also suggests strengthening of the foreclosure laws in the country. "It is imperative to amend foreclosure laws in the country for speedy foreclosure procedures in case of defaults. The National Housing Bank Act and Transfer of Property Act would be amended, if necessary," it has said.
The document also calls for re-hauling the existing registration procedures by States to make it simpler, and moots rationalisation of property tax system. "Loopholes would be plugged to remove the discretionary assessment so that collection of property tax would be enhanced," it said.
With housing activities in large towns and cities increasingly taking the form of apartments and condominiums, the States would be persuaded to enact Apartment Ownership Legislations.