Union Budget Announcements on Real Estate Sector: Budget 2021
For the first time ever a Union Budget went paperless, Due to the COVID-19 pandemics. During the pandemic in the form of lower sales and delay in construction of projects, considering that the real estate industry had battled adverse repercussions and the sector has high expectations from Union Budget 2021.
The Budget 2021 announcement shortly Finance Minister Nirmala Sitharaman will begin. From Union Budget 2021 here’s what the real estate industry gained:
In Union Budget 2021'Housing for All’ given priority
Housing for All and Affordable Housing was touted as priority areas, Under the Union Budget 2021.
• For affordable housing will be extended by 1 year Rs 1.5 lakh deduction on payment of interest.
• Till 31st March 2022, the Tax holiday for Affordable Housing projects will be extended.
• For notified affordable rental housing projects Government announced tax exemption to be provided.
In Union, Budget 2021Infrastructure gets a shot in the arm on new projects they unveiled the government's plans for constructing 8,500 km of highways will be awarded by March 2022. This will further create more job opportunities and will boost India’s infrastructure.
In four states the breakup on the highway projects announced by FM -
1) For the construction of 3500 km of road Tamil Nadu will get Rs 1.03 Lakh Crore.
2) 1500 km of road Kerala will get Rs 65,000 Crores for construction.
3) For the construction of 675 km of road West Bengal will get Rs 95,000 Crores.
4) For the construction of 1300 km of road Assam will get Rs 3,400 Crores.
• It will now be expanded to 7400 projects; The National Infrastructure was launched with 6835 projects.
• With Rs 20,000 Crore the government will introduce a bill to set up development financial institutions.
• They allocated Bangalore Metro close to Rs 15,000 Crore while Rs 62,000 Crore budget allocated for Chennai Metro.
Plans to privatize airports, FM sets aside Rs 1.15 Lakh Crore for Railways
• Rs 1.07 Lakh Crore will be towards CAPEX, Out of the Rs 1.15 Lakh Crore for Railways
• For the construction of a future-ready system by 2030 FM announces Indian Railways National Plan for India.
• In Tier 2 and 3 towns and cities the next lot of airports will be privatized.
In Union Budget 2021 Big boost to NRIs
• For NRIs on foreign retirement funds Government to notify new rules for elimination of the double taxation.
• As before NRIs were exempted from forming OPC in India, The budget also allows NRIs to form One Person Company (OPC). The NRIs to enter the Indian market with entrepreneurial skills, this move will benefit.
Amendment of InvIT and REITs
The FM announced that debt financing of Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InVITs) would be enabled, with an intention to attract more funding into the real estate and infrastructure sector. To achieve the same a suitable amendment would be made.
For the industry, bosses hope for a swathe of sops when Finance Minister Nirmala Sitharaman presents the Union Budget 2021-22 later Monday, after the demonetization jolt and a subsequent knockout punch reeling under a sluggish economy of the pandemic. On the wish list are sops for tier 2, 3 cities, CLSS extension to boost demand and to boost the local real estate market. From the Union Budget 2021-22 here’s what real estate players want.
