Mr. Rohit Gera, Managing
Director, Gera Developments & VP, CREDAI - Pune Metro on Union Budget 17-18
& Impact on Real Estate Sector
On the whole the
budget has a number of positive aspects. Given all the allegations about
populist budget in light of the upcoming state elections the government has
shown tremendous focus and has proved the naysayers wrong by not providing a
bunch of sops for the upcoming elections.
The move to reduce the maximum
gap on cash donations to political parties buy 90% to Rupees 2000 is also a
welcome move.
The reduction of
income tax for small and medium enterprises with the turnover of less than 50
crores to 25% is a positive move as is the reduction of tax for the sub Rs. 5 lakh
segment.
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| Rohit Gera, Managing Director, Gera Developments |
The impetus on infrastructure development with a large capital
deployment for the same will reap benefits in the short as well as long
term.
With regards to the
real estate sector, there are a number of positives such as the reduction of
holding period for long term capital gain as well as clarification on the date
of tax in case of joint development and the increase in the period required to
complete the projects for the sub 60 square meter segment.
Unfortunately, the
steps taken will not be enough to kick start the real estate sector which is
one of the engines of the economy.
The announcement of
according infrastructure status to affordable housing projects will truly only
see a big impact if these lower cost funds are actually made available for
acquisition of land.
Without this, a large part of the funds required for the
affordable segment for the construction are provided by the end consumer and
large scale capital is not required once the land acquisition is completed and
approvals are in place.
I wish, however, that
more steps had been announced to curb the regeneration of black money.
Now that the cash has come into the banks, it is critical that the process of
regeneration is addressed.
Without this, it is a matter of time before
the cash economy flourishes again. - by Mr. Rohit Gera, Managing
Director, Gera Developments & VP, CREDAI
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