NAREDCO urges a 50,000 crore SWAMIH 2.0 fund, ITC under GST, and tax reforms in the FY25 budget to drive affordable housing and boost real estate.
Aimed at accelerating affordable and mid-income housing, the National Real Estate Development Council (NAREDCO) has urged the finance ministry to roll out SWAMIH 2.0 with a huge Rs. 50,000 crore fund in the upcoming FY 2024-2025 budget. This proposal, coupled with calls for input tax credit (ITC) under GST and enticing incentives for rental housing, forms a comprehensive strategy to meet the “Housing for All” target.
NAREDCO, in a letter addressed to Finance Minister Nirmala Sitharaman, emphasised the importance of ITC for residential project developers, asserting that it would not only streamline accounting post-RERA but also foster compliance by reducing reliance on unregistered suppliers.
Addressing the tax implications arising from notional income on unsold properties held as stock in trade, NAREDCO’s President, G Hari Babu, suggested a critical amendment to Section 23(5). Proposing either the elimination of ‘notional income’ or an extended five-year timeline for its consideration, the move aims to alleviate the burden on developers.
Furthermore, NAREDCO advocates for the exemption of tax burdens on notional rental income to incentivise rental housing, and it proposes crucial amendments, such as the removal of the Rs. 2 lakh interest deduction cap under Section 24 of the IT Act, 1961, to stimulate housing demand.
