[ecis2016.org] Addressing a webinar, the housing secretary said the move would significantly lower the cost of property purchase for buyers, consequently reviving growth in real estate
Housing and urban affairs secretary Durga Shanker Mishra, on October 14, 2020, urged states to lower their stamp duty charges, to boost demand in India’s real estate sector, the largest employment generating industry in the country after agriculture. Addressing a webinar organised by industry body CREDAI, in association with business management consultant Nangia Andersen India, the housing secretary said the move would significantly lower the cost of property purchase for buyers, consequently reviving growth in real estate.
You are reading: Cut stamp duty on property purchases: Housing secretary tells states
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Note here that buyers have to pay stamp duty on property registrations under the Indian laws. Depending on the state where the property is being registered, the buyer will pay a certain percentage of the transaction value as the stamp duty. In the national capital Delhi, for example, 6% of the deal value will have to be paid as the stamp duty, if the property is being registered in the name of a man. In case a woman is getting the property registered in her name, the applicable duty is 4%.
States have taken a major revenue hit, because of a near-halt situation in property registrations during the phased lockdowns in India, imposed to restrain the Coronavirus pandemic. In states where the stamp duty cut is implemented, property registrations could increase, thereby, helping state revenue departments to improve their annual earnings.
“We have also written to all the states. I am also following up with different principal secretaries and secretaries of the states, to see if they can come up with such a move, which will help reduce cost,” Mishra said. While emphasising that the government and the Reserve Bank of India (RBI) have taken several steps in the past six years and during the lockdown period, to improve the health of the sector, Mishra also said that these measures, including the launch of the Real Estate Act (RERA), have started to show results.
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Mishra also lauded the Maharashtra government for lowering the stamp duty on property purchases in the state to 2% of the transaction value and the developers who have decided to waive these charges, with an aim to improve home sales during the ongoing festive season (October-December period). So far, only Maharashtra, Karnataka and Madhya Pradesh have affected reductions in stamp duty on property purchases, in view of the pandemic.
The housing secretary, however, also indicated that real estate developers must utilise the pandemic time to think of ways to lower the cost of property purchases for home buyers, while embracing technological changes to make the construction process faster, efficient, more effective and sustainable. He also urged the builder community to join the centre’s recently unveiled Affordable Rental Housing Complexes (ARHC) scheme, meant for migrant workers.
Source: https://ecis2016.org/.
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Source: https://ecis2016.org
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