Advertisement
When should a housing society in Mumbai start considering re...
From GST on JDAs to SEBI’s REIT reclassification and the S...
Stay ahead in the world of real estate with our daily podcas...
Stay ahead in the world of real estate with our daily podcas...
CREDAI, the apex body for real estate developers, has urged the government to implement a 100 per cent deduction on interest paid on home loans under the Income Tax Act to stimulate demand for affordable and mid-income housing. During a press conference, CREDAI President Boman Irani suggested revising the definition of affordable housing, increasing the price cap from INR 45 lakh to INR 75-80 lakh. He also proposed reducing GST on under-construction properties and removing price caps in the affordable housing definition. Additionally, CREDAI's leadership stressed the importance of tax cuts and improved ease of business for developers.
CREDAI, the leading body representing real estate developers, has urged the government to implement a 100 per cent deduction on home loan interest under the Income Tax Act to spur demand for affordable and mid-income housing. Celebrating its 25th anniversary, CREDAI also recommended revising the definition of affordable housing, proposing an increase in the price cap from INR 45 lakh to INR 75-80 lakh. Advertisement
At a press conference, CREDAI President Boman Irani suggested the government reduce GST to 1 per cent for under-construction properties priced up to INR 75-80 lakh, aiming to further encourage demand in the affordable housing sector. Currently, under-construction homes costing up to INR 45 lakh attract 1 per cent GST, while homes above this price range are taxed at 5 per cent GST, with developers unable to claim input tax credit.
Irani noted that the affordable housing cap, which was set in 2017, has not kept pace with inflation, thus warranting an upward revision to INR 75-80 lakh. He emphasized that such a change would benefit homebuyers by lowering GST rates on more properties.
Furthermore, CREDAI President Irani proposed eliminating the price cap entirely, suggesting that only the carpet area should determine affordability, with a cap of 60 square metres in metropolitan areas and 90 square metres in non-metropolitan regions.
CREDAI's President-Elect Shekhar Patel called for a 100 per cent deduction on home loan interest, replacing the current cap of INR 2 lakh, which would significantly boost demand. He noted that Section 24 of the Income Tax Act currently limits the deduction on interest for self-occupied properties to INR 2 lakh.
CREDAI Chairman Manoj Gaur added that developers face long delays in obtaining government approvals, stressing the need for reforms to improve the ease of doing business in the real estate sector. Established in 1999, CREDAI now boasts over 13,000 members across India.
CREDAI has called for critical reforms to address the growing demand for affordable and mid-income housing. By revising the price cap on affordable homes, introducing a reduced GST rate, and offering a 100 per cent deduction on home loan interest, CREDAI believes these changes will significantly benefit both developers and homebuyers. Furthermore, the organisation advocates for removing restrictive price caps in favour of a more flexible definition of affordable housing based on carpet area. Improving the ease of doing business remains a crucial issue, as developers continue to face delays in approvals. These measures are expected to boost the housing sector and support economic growth in the coming years.
5th Jun, 2025
25th May, 2023
11th May, 2023
27th Apr, 2023
Advertisement
Facebook
Whatsapp
