With significant reduction in personal income tax and expansion of interest subvention can push up demand, expansion of 80IB (10) benefit for another year provides solace for overdue eligible projects.
Real Estate sector which is gradually coming out of the mid 2008 recession, has obtained good assistance from Union Budget 2010-11. While the budget has promoted economical housing lesser than Rs 20 lakhs with 1% interest grant for housing loan up to 10 lakhs and expansion of benefits provided below section 80IB by another year, expansion of few services are absolute so as to bring under service tax impacting the industry in difficult times.
But the industry which wanted an industry status for township projects, modifications in tax deduction on housing loans,
However the industry which asked for changes in tax deduction on housing loans, easing of ECB path to finance projects etc has been ignored.
But those real estate players who have got their 801B (10) projects deferred can find solace in the fact that the period for completion has been increased to 5 years from the present 4 years. Besides the interest financing scheme of 1% on all individual housing loans not exceeding Rs. 10 lakhs (Rs. 1 million) for units priced up to Rs. 20 lakh (Rs. 2 million) till 30th March 2011 is sure to promote economical housing.
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