New Delhi, Feb 1 (PTI) The government today announced a dedicated affordable housing fund under the National Housing Bank (NHB) to boost demand and supply of low-cost homes.
Finance Minister Arun Jaitley said in his Budget speech that the government will "establish a dedicated Affordable Housing Fund (AHF) in National Housing Bank, funded from priority sector lending shortfall and fully serviced bonds authorised by the Government of India."
National Housing Bank Act is being amended to transfer its equity from the Reserve Bank of India to the government, he added.
In last years Budget, the government had announced infrastructure status to affordable housing.
To boost real estate transaction, the Budget proposes that real sale value of immovable property would be considered while taxing income from capital gains if circle rate value does not exceed 5 per cent of the consideration.
"Currently, while taxing income from capital gains, business profits and other sources in respect of transactions in immovable property, the consideration or circle rate value, whichever is higher, is adopted and the difference is counted as income both in the hands of the purchaser and seller.
"Sometimes, this variation can occur in respect of different properties in the same area because of a variety of factors including shape of the plot and location.
"In order to minimise hardship in real estate transaction, I propose to provide that no adjustment shall be made in a case where the circle rate value does not exceed 5 per cent of the consideration," Jaitley said.
Commenting on this proposal, JLL India CEO and Country Head Ramesh Nair said this would reduce hardship to sellers as they would not be compelled to pay higher capital gains tax if the difference is within 5 per cent of circle rates.
"For calculating capital gains, with an announcement a couple of years ago, a higher value between circle rate based value and contract documented value would be considered as current sales value," he added.
This Budget announces that if the circle rate is higher by not more than 5 per cent, then capital gains will be considered based on contract documented value and not circle rate based value. PTI MJH SBT
Copyright©2021 Living Media India Limited. For reprint rights: Syndications Today