The global recession has hit not only the financial institutions and share markets in the country but also the real estate sector. On the one hand, there is no demand for high cost apartments and there is an unsold stock, while on the other there is a great demand for housing from poor, lower and higher middle class for economy houses.
Government should never forget that the slump in the real estate market will have a direct bearing on other sectors as well such as Steel, Cement, electrical, paint, glass and wood industries etc. The real estate industry provides employment to a large number of skilled, unskilled and technical personnel. Not only this, the Real estate industry is a great revenue earner for the States both under direct and indirect taxes.
Since Housing is one of the basic necessities, Government should initiate urgent action to cater to the housing needs from all categories of people. Formation of Special Residential Zones for construction and supply of residential accommodation for poor, lower and middle class people at affordable costs, motivating the private property developers to construct economy houses or apartments for poor, lower and upper middle classes by offering subsidy or incentives, introduction of Single Window Clearance system to avoid delay in getting approval from BDA/BMRDA and No Objection certificates from different Governmental bodies such as, BWSSB, BESCOM Pollution Control Board, etc., reduction in the levy of taxes such as VAT, Service Tax, etc., levied on the raw materials used in the construction industry and reduction of stamp duty and registration charges and the estimated market value of the immovable properties and buildings fixed by the Government could be some positive steps in this direction.
The levy of property tax can be on slab system basis instead of percentage basis. Further, the commercial banks may be instructed to provide housing loans to the people with reduced rate of interest with an assurance that the rate of interest will remain stable during the tenure ofthe loan period.
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