Friday, February 23rd, 2024

Home buyers are burdened with so much tax that they can buy another property, figures will surprise you

Photo:INDIA TV home buyer

National Real Estate Development Council (NAREDCO) Rajan Bandelkar, President, believes that there is a need to remove taxes at various levels to make houses affordable for common people. He said that on buying a house worth Rs 1 crore, Rs 33 to 36 lakh goes as tax. That is, if you buy a house worth Rs 50 lakh, then you have to pay a tax of Rs 16 to 18 lakh. Bandelkar said that unfortunately today the developer’s ‘margin’ in the real estate sector is in single digits. The government will have to reduce its share. He said, if you buy a house worth Rs 1 crore today, then Rs 33 lakh to 36 lakh goes into the government’s account in one form or the other as tax. I am not talking about income tax. These various taxes and revenue are received by the central government, state governments and local administration. Thus one-third of the total cost of the house goes to the government.

Requesting the government to reduce the tax burden

Appreciating the steps being taken by Prime Minister Narendra Modi government to make houses affordable, Bandelkar also requested him to remove some taxes. “The government is already doing a great job for affordable housing, but to make it more affordable, all these taxes have to be removed,” he said, speaking on the sidelines of an event to mark the 25th anniversary of NAREDCO in Hyderabad. Before introducing the Goods and Services Tax (GST), the government had said that octroi tax would be removed, which was also removed.

Even after GST, there are still many types of taxes

However, there are still many hurdles like stamp duty, local tax which are increasing the burden on the home buyers. The government should look into it.” During the event, Bandelkar expressed confidence that the contribution of the real estate and infrastructure sector to the country’s gross domestic product (GDP) would increase significantly in the next few years, which would exceed the current levels due to its potential. Will cross seven percent. He assured the people that NAREDCO is committed to extend full support to the government in affordable housing and other development works.

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