Budget 2019: Incentivising the Developer And Home-Buyer
Kapil Sharma, Partner, Lakshmikumaran & Sridharan Attorneys on Budget 2019
The Hon’ble Minister of Finance, Ms Nirmala Sitharaman, in order to boost the ailing real estate industry has made several announcements in the budget speech. The Government in continuing with the reforms in the real estate sector has focussed on incentivising the developer and home-buyer in the affordable housing sector.
At the forefront, the definition of the affordable housing under Section 80 IBA of the Income Tax Act, 1961 has been amended in line with the amended GST provisions allowing a 100% deduction to developers on profits and gains from housing projects.
To incentivise the purchase of affordable houses, the home buyer would be allowed deduction of the interest paid from on loan taken in respect of residential house property of stamp duty value upto 45 lakh rupees.
To add on to the above boosting measures, the holding period for long-term gain on immovable property has been reduced from 36 months to 24 months.