In order to gain the benefit of 100 per cent income tax rebate under Sec.80-IB(10) of the Income-Tax Act,1961 in respect of the profits and gains arising from the business undertakings developing housing projects, a large number of builders have speed up their construction activities throughout the country including Bangalore. But the demand for apartments in and around Bangalore has not gone up as expected mainly for the reason that the overhead expenses in respect of purchase of an apartment would come to more than 25% of the total cost.
The over- head expenses would, inter alia, include revision of registration charges and stamp duty, corpus deposit, stamp duty on mortgage loan, fluctuations in lending rates on housing loan by Banks, charges for car parking, service tax and the like. This has forced the intending buyers to make suitable adjustments in their financial planning and
Granting incentives to builders on Housing projects is definitely a welcome move. But, at the same time, the cost of an apartment/house should be within the reach of a commonman Government should have formulated the scheme in such a way that the benefit of incentive could percolate downwards and not to fatten the purses of rich builders.
Government may, at least, stabilize lending rates on house construction/purchase, remove stamp duty on mortgage loans and increase income-tax rebate on investment in construction/purchase of house/apartment by individuals and other intending investors. - Editor
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