-Advertisement-
June 24, 2021 11:05 am
-Advertisement-

Real estate sector deserves serious attention in Budget 2021

Must Read

Considering the real estate sector is the second-largest employer in the country and directly or indirectly, accounts for about 10 per cent of the GDP, it deserves serious attention in the upcoming Budget 2021.

Within realty, the commercial real estate has been a watch-out sector for investors both overseas and back home owing to its strong fundamentals and resilience. The government should therefore consider measures to further encourage more NRI investments in the country. For instance, considering a reduction in the income earned from long-term capital gains would be helpful.

Owing to fractional platforms, affordable commercial realty is now a reality in India and therefore for retail investors intending to invest in commercial assets, the government should consider a higher exemption limit. Alternatively, since both the interest income as well as dividend earned by investors are taxable as per their slab rates, the government should consider a waiver of tax on dividend.

These measures will help boost retail sale which in turn can offer a huge impetus to trade and economic activities. Considering personal loan is expensive, the government should also bring in a whereby retail investors can avail a loan seamlessly from banks at a reasonable interest rate for investment in commercial assets through fractional route.

Besides, it is important to address investor sentiments while also addressing the challenges being faced by developers. For instance, considering a stress fund can help generate cash flow for developers thereby helping build the supply side of the . Alternatively encouraging banks and NBFCs’ to lend to commercial real-estate projects or take over and restructure stalled projects will also go a long way in kick-starting the economy.

Similarly, properties that are not sold but developed for leasing, GST at 18 per cent should be reconsidered as it is a huge liability for the developers as it pushes the cost of construction and poses further challenges in the wake of a liquidity crunch.

Additionally, the government should also consider incentivising alternative asset classes such as warehousing, SEZs’, data canters and co-working spaces to build momentum on both the demand and supply side.

The author is co-founder of Strata. Views are personal.

ALSO READ

Subscribe to receive the day's headlines from Tech Observer straight in your inbox

- Advertisement -

DISCUSSION

LEAVE A REPLY

Please enter your comment!
Please enter your name here

LEAVE A REPLY

Please enter your comment!
Please enter your name here

- Advertisement -

Latest in TECH

EV charging station startup Kazam raises Rs 7 crore in Seed round from Inflection Point Ventures

Kazam solutions are focused on providing affordable and smart electric vehicle charging stations that are built in India. So far the company has set up over 30 charging stations in 5 states including Karnataka, Maharashtra, Delhi, Telangana, and Tamil Nadu.

RELATED ARTICLES

- Advertisement -