Real estate contributes around 8% to the overall GDP of the country. Acknowledging such a strong pillar of the economy, the government must foster policy reforms to accelerate growth in the realty sector.
As the industry is slowly and steadily getting back on track after two consecutive waves of Covid-19 pandemic, it is looking at a robust housing demand revival in 2022. Here, the Union Budget 2022 can play a supportive and enabling role. The sector is looking at a few tax relaxations:
1. There should be a revision in ₹2 lakh Interest rebate under Income Tax Section 24, as in the aftermath of the pandemic, as disposable income has reduced due inflation and salary cuts.
2. Raw material prices have increased by 30% in the last 2 years which is eating away the margin for low cost housing sector, Input credit of GST should be allowed to overcome these losses
Besides this, several big companies like Twitter, Tata Steel, etc have completely switched to remote working modes. The work-from-home culture has surged the demand for Holiday Homes. Many Holiday Home developers are actually boosting rural tourism near the main cities, helping in generating stable income for local laborers & raising the standard of living.
It would be best if the Finance Minister considers Waivers or reductions on GSTs on raw materials such as cement, steel, etc. as well as concession on stamp duty or provides special allowances to promote such developers who can impact travel & tourism opportunities for local welfare in the rural areas.