Industry desires Realty Premiums Deductions in other States after Maharashtra Govt cuts Realty Premiums to 50%
New Delhi: Industry has welcomed the Government of Maharashtra move to reduce premiums charged by the civic authorities by 50 per cent basis ready reckoner rates of 2019 or 2020, whichever is more, for the next one year until 31 December 2021, as recommended by the Deepak Parekh committee.
This is expected to give a fillip to the real estate activities in the state. While on one hand it will reduce the stamp duty burden for the buyers, it will, on the other support the developers in building new projects at a reduced input cost thus effectively lowering the price for new projects in the long run.
Mr Sanjay Dutt, Joint Chairman, FICCI Real Estate Committee & MD & CEO, Tata Realty & Infrastructure Ltd said that the Maharashtra government has been proactively listening to the challenges faced by the real estate sector, which is of the biggest employers and contributor to the economy.
Despite stamp duty reduction showing an increase in revenue for the state, the state government realized that given the current low residential demand and reduction in prices many projects were not viable. This move will ensure that projects stuck for last mile funding, or that have no takers of unviable projects, are considered. Despite a hair cut in value by the developers and lately NBFC, it was not appealing to the PE. The reduction in premiums will serve as role model for other state governments to revive the real estate sector and bring back much needed employment and overall reduce the pain of the pandemic, he said.
Mr Raj Menda, Joint Chairman, FICCI Real Estate Committee & Corporate Chairman, RMZ Corp welcomed the announcement and said, “This is a good move by the Government in being proactive to revive the Real Estate industry. We hope that other states take similar initiatives.”
Mr Getamber Anand, Co Chairman, FICCI Real Estate Committee & Chairman & Managing Director, ATS Infrastructure Ltd said, “It is an absolutely practical step in the right direction that will help our sector to stand up and create jobs for the unskilled and the semiskilled population of our country.”
This is the second consecutive positive move by the government of Maharashtra to stimulate the Real Estate Sector. It had earlier reduced the stamp duty rates from 5 per cent to 2 per cent till 31 December 2020 and 3 per cent till March 2021.
Industry leaders observed that such move will not just trigger cost reduction but also enable the developers complete their projects on time with a major enhancement in developers operational capacity.