The real estate developers’ group, CREDAI, asked the government on Monday to offer 100% tax exemption on home loan interest under the income Tax Act. CREDAI made this request to increase demand for affordable and middle-income housing. Celebrating its 25th anniversary, CREDAI also announced plans to open 1,000 schools next year. They also suggested raising the affordable housing limit from Rs 45 lakh to at least Rs 75-80 lakh.
Demand to Lower GST from 5% to 1%
On its 25th anniversary, CREDAI president Boman Irani recommended reducing GST to% for under-construction homes costing up to Rs 75-80 lakh, to encourage more affordable and middle-income housing. Right now, homes under Rs 45 lakh have 1% GST, but those above Rs 45 lakh have 5% GST. Companies cannot get the input Tax Credit (ITC) on these.
Affordable Housing Definition from 2017
Irani explained that the affordable housing limit of Rs 45 lakh was set in 2017. Considering inflation since then he said this limit should be updated to Rs 75-80 lakh. He also mentioned that changing the definition would reduce the GST benefits for potential homebuyers. CREDAI suggested that the government remove the price limit altogether and instead focus on carpet area-60 square meters in big cities and 90 square meters in smaller cities.
Shashi Rai
