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Saturday, 1 July 2017

GST on real estate: Effective GST rate on under-construction real estate at 12%

The GST Council had in May decided to levy 12 per cent GST on construction of a complex, building, civil structure or intended for sale to a buyer, wholly or partly.

The effective GST rate on under- construction real estate projects will be 12 per cent only and not 18 per cent as there will be abatement for land cost, according to tax consultant EY.

Realtors' body CREDAI President Jaxay Shah also said that the effective GST rate would remain at 12 per cent and assured that as per the law, the developers would pass on the benefits of input tax credit to home buyers.

On Thursday, the government hiked the GST rate for the construction sector to 18 per cent from 12 per cent but removed land value from computation of tax liability.

The GST Council had in May decided to levy 12 per cent GST on construction of a complex, building, civil structure or intended for sale to a buyer, wholly or partly.

Earlier, the value of land was to be included in the amount on which tax was to be calculated.

"There is some confusion in the industry that GST on under-construction projects has been fixed by the government at 18 per cent instead of the 12 per cent proposed earlier by the GST Council.

"This confusion is mis-placed as there is an abatement of one-third for the value of land when you apply the rate of 18 per cent; which makes the effective GST rate 12 per cent only," said Abhishek Jain, Tax Partner, EY.

When contacted, CREDAI President Jaxay Shah also said that the effective GST rate will remain 12 per cent on under- construction properties.

Asked whether builders will pass on the input tax credit to home buyers, he said: "As per law, we will return input tax credit to buyers".

As on today, home buyers have to pay 15 per cent service tax on 30 per cent of the total cost of the apartment, which is effectively 4.5 per cent.

NAREDCO President Parveen Jain said the effective rate will be 12 per cent after the abatement for land value.

Earlier this month, NAREDCO had written to the Prime Minister seeking lower GST of 6 per cent on sale of under- construction property from 12 per cent as higher tax will lead to price rise and affect sales.

It had also sought exemption from Goods and Services Tax (GST), to be rolled out from July 1, to affordable housing which has gained momentum after getting infrastructure status and interest subsidy.

Thursday, 9 March 2017

Haryana Govt Working to Benefit all Private Builders

A senior official in the DTCP, which was of the subjects of Aggarwal’s ire in the assembly, said the MLA has not been able to substantiate his allegations because there is no wrongdoing.

Umesh Aggarwal, Gurugram’s BJP MLA, on Wednesday defended his line accusing the Manohar Lal Khattar regime of tweaking affordable housing rules to favour real estate companies, a day after he criticised his own government in the assembly on the issue.

“The Gurugram master plan is being changed to benefit private builders,” he told TOI. “The area for affordable housing projects is being increased from 300 acres to 500 acres to suit their (realtors’) needs,” he added. Asked if he was referring to a particular builder, Aggarwal said the government was working to benefit “all private builders”. He did not, however, elaborate.

A senior official in the department of town and country planning (DTCP), which was of the subjects of Aggarwal’s ire, in the assembly, said the MLA has not been able to substantiate his allegations because there is no wrongdoing. “To begin with, the affordable housing policy the MLA is referring to was prepared by the Congress government in 2013,” said this official. “During the previous government, 42 licences were issued and the present government has issued 25, of which 6 are delayed. Before the policy was passed, the draft was put in the public domain. In anticipation that the policy will be approved, some builder had prepared a draft beforehand,” the official added, referring to another charge made by Aggarwal in the assembly.

“I wonder how builders can prepare the draft ahead of finalisation of the policy,” Aggarwal had said on the floor of the House on Tuesday. “Complaints lodged by me are still pending at various levels. Neither the previous government, nor this one has ordered any probe to ascertain the shortcomings. They (builders) have been given licences instead.”

Asked about the “lapses” finance minister Captain Abhimanyu had acknowledged while replying to Aggarwal, another DTCP official said he was referring to the necessity for a course correction. “As per the policy, in every sector where land is available, 10 acres will be used for affordable housing projects,” the official explained. “The minimum land requirement is 5 acres. So far, the first-come-first-served’ principle was being followed to issue licences to builders. But there were objections and it has been decided that instead of this, a lottery system will be introduced.”

He added, “This is the lapse which the finance minister was referring to. There are otherwise no lapses in the issuance of licences for affordable housing.” he said. The finance minister could not be reached for a comment.

Friday, 3 March 2017

Govt to Soon Announce Relaxations in Foreign Direct Investment

The government last year relaxed FDI norms in over a dozen sectors, including defence, civil aviation, construction and development, private security agencies.

The government is expected to soon announce relaxations in the foreign direct investment (FDI) policy in certain sectors, including single brand retail.

The further liberalisation in the FDI policy is aimed at providing better business environment by removing impediments, an official said.

The easing of the policy will be on the lines of the announcements made by Finance Minister Arun Jaitley in the Budget for 2017-18.

The government last year relaxed FDI norms in over a dozen sectors, including defence, civil aviation, construction and development, private security agencies, real estate and news broadcasting.

Union Minister Harsimrat Kaur Badal recently stated that the government will consider the demands made by foreign retailers for allowing non-food items such as homecare products under the policy.

The government is also considering a proposal to increase FDI limit in print media to 49 per cent from 26 per cent.

Besides, a proposal to allow 100 per cent FDI through the automatic route in single brand retail is also under consideration with a view to attracting more global players in the sector.

Foreign investments are considered crucial for India, which needs around $1 trillion to overhaul its infrastructure such as ports, airports and highways to boost growth.

Foreign investments will help improve the country's balance of payments situation and strengthen the value of the rupee against global currencies, especially the US dollar.

FDI inflows into India firmed up by 22 per cent to $35.85 billion during April-December 2016.

By  - http://realty.economictimes.indiatimes.com/news/regulatory/govt-to-soon-announce-relaxations-in-foreign-direct-investment/57428072

Friday, 16 December 2016

China's Wanda Group Submits Proposal to Build $10 Billion Township in Haryana's Sonepat

New Delhi : Days after a leading Chinese company signed a memorandum of understanding (MoU) with the Haryana government to set up 100 MW solar power projects in the state with an investment of Rs 500 crore, Wanda Group (one of the largest real estate developers in China) has submitted a proposal for setting up a green field integrated industrial township in Sonepat district in joint venture with the Haryana State Industrial and Infrastructure Development Corporation Limited (HSIIDC).

The joint venture will develop, operate and manage the integrated industrial township at Kharkhoda in Sonipat district.

According to an official spokesperson, the sponsors anticipate that the joint venture will catalyse investment worth $10 billion (Rs 65,000 crore) and generate opportunities for 34,000 direct jobs.

The project at Kharkhoda would fall within the Delhi-Mumbai Industrial Corridor and the National Capital Region. “Jointly developed by Wanda Group and the HSIIDC in phases over 2,800 acres, it will house companies engaged in software, automotive manufacturing, machinery, healthcare education, smart housing appliances and food processing,” he added.

The spokesperson further said a residential township integral to the project, including all civic amenities and social infrastructure, would also be created to develop a 4th generation integrated industrial township. Furthermore, a “cultural tourism city” will also be developed as part of the project.

According to the officials, the investment proposal is an outcome of a series of meetings between chief minister Manohar Lal Khattar, and chairman of Wanda Group Wang Jianlin.

Wanda Group is a $92-billion conglomerate whose business interests encompass shopping malls, theme parks, sports industry, and cinemas. It is one of the largest real estate developers in China with presence in the US, UK, France, Spain, and Australia.

Earlier, the Haryana government had signed an MoU with a leading Chinese company Prestige Ocean Holding and Investments Limited for the setting up of 100 MW solar power projects in the state with an investment of Rs 500 crore. The development had taken place over a month after several BJP leaders, including Haryana ministers, had asked people to boycott Chinese items.

Wednesday, 9 November 2016

नोट बैन: रियल स्टेट पर पड़ेगा असर, प्रॉपर्टी रेट्स में आ सकती है गिरावट

ब्लैक मनी को खत्म करने के लिए 500 और 1000 के नोटों का किया गया मोनेटाइजेशन का सबसे ज्यादा प्रभाव रियल्टी और गोल्ड सेक्टर पर पड़ेगा। साथ ही डिजिटल पेमेंट्स कंपनियों में हिस्सेदारी रखने वालों की चांदी होगी। रियल्टी सेक्टर पर पड़ने वाले सबसे अधिक असर से प्रॉपर्टी के रेट्स गिर सकते हैं।

रियल स्टेट में ब्लैक मनी का काफी इस्तेमाल होता है। 500 और 100 के नोट्स के डिमोनेटाइजेशन के बाद रियल स्टेट सेक्टर में पारदर्शिता आने की उम्मीद है। इस कदम से प्रॉपर्टी की कीमतों में गिरावट लगभग तय मानी जा रही है। ऐसे में निवेशक रियल स्टेट में पैसा नहीं लगा पाएंगे और बिल्डर्स को मजबूरन प्रॉपर्टी के रेट्स गिराने होंगे। दिल्ली-एनसीआर में इस का सबसे ज्यादा असर देखने को मिलेगा क्योंकि यह मार्केट कैश में कारोबार के लिए जाना जाता है।

कितनी होगी गिरावट
ऐस्टेट एजेंट्स असोसिएशन ऑफ इंडिया के प्रेजिडेंट यशवंत दलाल के अनुसार, 'प्रॉपर्टी मार्केट्स में 30 प्रतिशत के करेक्शन की उम्मीद है। मार्केट्स कंडीशन्स को देखते हुए ऐसे बिल्डर्स को भी रेट्स घटाने होंगे जो चेक से पेमेंट लेते हैं। दिल्ली-एनसीआर के अलावा छोटे शहरों के प्रॉपर्टी रेट्स पर भी इसका काफी असर पड़ेगा।'

इसके अलावा प्रॉजेक्ट्स में देरी की भी समस्या आएगी। निवेश होने की स्थिति में बिल्डर्स निमार्ण कार्य की गति कम कर देंगे। डीएलएफ के सीईओ राजीव तलवार का मानना है कि सरकार के इस कदम के बाद से रियल्टी सेक्टर ज्यादा पारदर्शी हो जाएगा।

Source - http://navbharattimes.indiatimes.com/business/property/property-news/real-estate-to-be-hit-hard-but-homes-may-get-cheaper/articleshow/55326880.cms

Thursday, 20 October 2016

BMW launches 3 Series Gran Turismo at Rs 43.30 lakh

BMW globally unveiled the 3 GT facelift a couple of months back. This time around, India being one of its important markets, it has launched the new 3 GT at Rs 43.30 lakh. The new 2016 BMW 3 Series Gran Turismo is offered in three trim levels: 320d Sport Line, 320d Luxury Line, and 330i Luxury Line. Loaded with impressive performance figures, styling and the fact that it has no direct competition for now, it is indeed expected to do well in the Indian market.  

BMW 3 Series Gran Turismo is available in one petrol and two diesel variants. The diesel 320d is powered by a 2.0-litre four-cylinder engine that puts out 187bhp of power and 400Nm of torque. While, the top spec petrol 330i is powered by a 2.0-litre four-cylinder engine which puts out 249bhp of power and 350Nm of torque. 

The front and the rear section have been revised, thereby making the Gran Turismo appear bigger than the regular version. In terms of dimensions, the GT is about 190mm longer, 79mm taller and about 17mm wider. The new pair of LED headlamps connect to the kidney grille on the front. The bumper houses fog lamps and has been revised for freshness. The rear sports bigger LED tail lamps.
As for the interior, it gets premium leather upholstery as seen in the 3 Series. The GT version comes loaded with electrically adjustable seats, powered sunroof and the iDrive system. The rear sear section offers better legroom and the company claims that it can accommodate around three passengers comfortably. The car comes with a decent 520litres of boot space which can be easily stretched to 1,600litres, all thanks to the 40:20:40 split configuration at the back.

BMW 3 Series Gran Turismo variants are priced (Ex-showroom, Delhi) as follows –

BMW 320d Gran Turismo Sport Line – Rs 43.30 lakh
BMW 320d Gran Turismo Luxury Line – Rs 46.50 lakh
BMW 330i Gran Turismo Luxury Line – Rs 47.50 lakh

Wednesday, 5 October 2016

Sonepat, Emerges as The Next Hottest Real Estate investment Destination in Haryana

Sonepat, a flourishing urban city in Haryana, lies just 16 kms away from Delhi and has emerged to be an important part of National Capital Region. Property in Sonepat is a hub of residential and commercial establishments that comprises of educational, corporate, industrial, hospitality and infrastructural projects. The city has a skyrocketing realty market that is witnessing a remarkable growth in almost all the sectors. Engulfed in rich green spaces, it is the most sought after destination by many buyers and investors and has several landmark projects coming up in various segments. Proximity to Delhi and great connectivity to some of the prime locations of Haryana add wealth to the city’s realty growth. The competitive property prices have made the place a desired target for many investors as well as developers as the prices are anticipated to appreciate considerably. Plots in Sonepat offer genuine benefits to all its investors as it gives you the freedom to build your home in your own style. The developers are eyeing this area as property rates in other parts of NCR are too high and they have an option to invest here and make quick profits in future.

An eight - lane express highway is also on the cards that will connect industrial areas like Sonepat, Bahadurgarh, Jhajjar, Palwal and Gurgaon. Many corporates are also proposing SEZ around the Expressway.

Kundli is the key locality in Sonepat that holds excellent investment potential due to the current and upcoming infrastructural developments happening like KMP Expressway, the 100-metre-wide road from the IGI Airport to Narela, the 5000 acres Rajiv Gandhi Education City at Sonepat, a proposed textile park, logistics park and improved rail connectivity.

Top developers coming up with independent floors in Sonepat are Jindal Realty, Omaxe Group, Eros Group, TDI, Ansals, ELDECO and Parasvnath.

Another reputed developer known as “Jindal Realty” is marking its huge presence in the property market in Sonepat. It is one of the top realty developers in Haryana that is coming up with mega integrated township project named as Sonepat Global City. The group in its real estate product range offers independent floors for a secured and spacious lifestyle, plots to give you the choice to build your homes the way you like, palatial villas for a lavish living for the discerning few and a commercial center in Sonepat.

Thus from the investment point of view, Sonepat due to its proximity to Delhi is and will always remain a promising location. Investors in order to get decent returns on their capital need to maintain an investment period of minimum 3-5 years so that the region develops sufficiently.