Realtors seek hike in deduction on home loan interest to Rs 5 lakh in Budget
   Date :15-Jan-2021

Rs 5 lakh in Budget_1&nbs
 
 
Business Bureau :
 
REALTORS’ body Naredco on Thursday urged the government to hike deduction on home loan interest to Rs 5 lakh from Rs 2 lakh limit at present and re-introduce subvention scheme in the upcoming Budget to boost sales of residential properties and create housing revolution. The association also sought incentives for rental housing and more stress funds to help complete distressed and stalled projects. “Last three years have been extremely difficult for the real estate industry. The reforms like demonetisation and realty law RERA as well as the liquidity challenges in the NBFCs post-IL&FS crisis hit demand.
 
The industry went through tough times,” Naredco National President Niranjan Hiranandani said. He said, the central government and some states like Maharashtra have taken various decisions to boost housing demand, but more needs to be done. “We want a housing revolution like the IT revolution and green revolution,” Hiranandani said. Listing out the association’s key pre-Budget demand, the Naredco President said there is a need to rationalise personal taxes as it has been done for corporates. Hiranandani said, the deduction on home loan interest should be enhanced to Rs 5 lakh from Rs 2 lakh under section 24 of IT Act 1961 in order to incentivise home buyers.
 
He also recommended long-term capital gains at 10 per cent (on par with the provision of section 112 for equity shares and reduction in the period of holding house property to up to 12 months from existing 24/36 months to qualify as a long-term capital asset. Naredco Chairman Rajeev Talwar said the government should lift the ban on subvention schemes, wherein real estate developers pay home loan interest on behalf of homebuyers for a certain period. In 2019, the National Housing Bank’s (NHB) banned lending by housing finance companies under the subvention scheme. The association also pitched for extension of the Credit Linked Subsidy Scheme (CLSS), under which subsidy up to Rs 2.7 lakh is being provided to home buyers.