You are here: Home » Budget » News
Business Standard

Budget 2021-22 wishlist: Here are the key challenges in real estate sector

Given the market / pandemic situation, there is an overall fall in the fair market values of properties

Budget | Indian Economy | Real Estate

Business Standard  |  New Delhi 

construction, real estate

Key challenges

  • Given the market / pandemic situation, there is an overall fall in the fair market values of properties. The reckoner values (circle rates) have pretty much remained at the pre-Covid levels. Such a situation leads to tax being calculated on deemed income basis.

  • Pre-sales have reduced significantly due to lack of customer confidence on delays in project completion. This has created liquidity issues with residential developers.


Industry ask


  • transactions (immovable property or shares of property companies) between non-related parties to be exempt from deemed income provisions [such as 56(2)(x) and 43CA]. The fall in market value due to the pandemic is much more than the safe harbour currently provided under these provisions.

  • Reduction in stamp duties in some states led to significant increase in demand. To enhance the demand further across the country, a long-term capital gains exemption could be provided on all under construction properties purchased during FY 2021 / 22. With reduced stamp duties and no capital gains, it would be a great incentive for property buyers and would also boost the GST collection.

  • In view of the enhanced focus on the digital economy, there will be a need for high quality data centres. Tax incentives for developers undertaking data centre projects would help in providing the initial boost to this niche asset class.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Sun, January 10 2021. 22:42 IST