The Finance Minister Nirmala Sitharaman will table the Union Budget 2022 on 1st February and the realty sector is pinning high hopes. The growth-oriented steps taken by the government have helped the sector regain momentum and more announcements in this direction can boost the market sentiments further.
Budget 2022 – Expectations from the government for a strong realty growth
Mohit Goel, MD, Omaxe Ltd. says, “The Union Budget 2022 must focus on strengthening the investment climate and streamlining taxation in the real estate sector. It expects the government to address its long-pending ask of industry status and single-window clearance. Huge investment and collaboration through Public-Private Partnership (PPP) in infrastructure and urban development will give impetus to the country in doubling its economic potential and catering to growing urbanization. The government should bring reforms and incentives to encourage more participation from the private sector. Besides, special incentives for real estate developers to undertake large-size projects should also be considered in the budget as this will give a much-needed fillip to the development of urban clusters, habitation, and employment opportunities.”
Developers also expect that the input cost of infrastructure development will see significant changes in the GST bracket along with incentives on raw materials.
“The challenges faced due to the disruptions during the unprecedented pandemic, have given way to new opportunities of business expansion. With challenges have risen opportunities and with disruptions have emerged resilience. With expectant anticipation, we are confident that the new budget will reflect these trends. We are also hopeful that the input-cost of the infrastructure development sector will see significant changes in the GST bracket,” says Mohit Jain, Managing Director, Krisumi Corporation.
According to Vivek Singhal, CEO, Smartworld Developers, a reformist, and pro-growth budget will be a big booster for the realty sector.
“I sincerely believe that Union Budget 2022 will be pivotal in defining the way forward for the Indian economy amid the ongoing third wave of the COVID pandemic. A single step of increase in the tax-free limit on interest paid on home loan under sec 24 from current Rs. 2 lacs to 100% of interest paid for three years will be the biggest booster this industry can expect,” he says.
Ashok Jaunapuria, MD & CEO, SS Group expects, “Waivers or reductions should be offered on GSTs on raw materials such as cement, steel, etc. Reduction in GST rates can give a lot of relief to developers as we also have to compensate for the lost time due to the havoc of the pandemic.”
The expectation of industry status and a single-window clearance system for speedy approvals.
“The necessity for an online single-window clearance is urgent, as it would speed up the multiple approval procedure. An online single window clearance solution is urgently needed also to increase system transparency. We are optimistic that the government would shape its policy actions to promote real estate demand even further this year,” says Santosh Agarwal, CFO and Executive Director, Alpha Corp.
Developers believe that boost to MSMEs, start-ups can accelerate growth in commercial real estate.
“Boost to start-ups and MSME will also support the growth of commercial realty. Therefore, the government should consider facilitating tax-incentives, adequate infrastructure, the establishment of dedicated clusters in propelling the growth of start-ups and the MSME sector,” says Abhishek Pandey, Vice President – Customer Engagement & Distribution, Viridian RED.
Mirroring similar sentiments for commercial real estate, Vineet Taing, President, Vatika Business Centre adds, “In the new budget, we are expecting a reduction in the TDS deduction rates on co-working spaces from the government. Also, a consideration to bring co-working spaces into a 2% TDS slab will immensely help in managing the cash flows.”
Shashank Vashishtha, Executive Director, eXp India, says, “The challenges of the pandemic are still in place and to sustain growth, the government should bank on policies and measures that attract foreign investments and accelerate capital inflow. This will encourage buyers and sellers and will boost the momentum for sustainable economic growth.”