Stamp Duty and Registration Fees to 5 – 6 percent.
Once the state government decides to lower Registration and Stamp duty fee, then buying homes may be come affordable for home buyers. The institutions have kept their stand that lowering the fee will certainly make homes available for more people thus increasing the overall revenue generation from property in the country.
Statements made by financial institutions
- Sriram Kalyanaraman (MD, NHB) have made it clear that recommendations have been made with the state government requesting for lowering these rates for buyers. This will make homes meow affordable.
- He also added that if this recommendation could be passed by the state government then it is certain that more number of people belonging to middleclass families could afford investing in purchasing house.
Expectations from the new recommendations
- The Housing financial institutions expect that once the recommendation has been implemented by the state government then it is certain that a relief shall be offered to most middle class families.
- This scheme will help cut down the amount of money they may have to invest in purchasing home by lowering the marginal money they would pay to invest in buying. This will help benefit everyone who for whom purchasing home is presently difficult task.
- After the implementation it is also obvious that the stamp duty charges may cut down by another 5 to 6 percent on the overall cost of the home. This is valid for any property including apartments. Presently some states have stamp duty as high as 12.5 percent.
- Under the scheme it is also certain that government aims to provide housing facilities for more number of people by the year 2022. This means that millions of homeless people in the country can get their own homes.
Steps to be taken by the state government
- Under the scheme the state governments has managed to set the target of constructing nearly 29.5 million homes for people by the year 2022.
- These recommendations of lowering Stamp duty and registration amount has already been implemented by many states in the country.
- Jharkhand, Andra Pradesh, Maharashtra, Gujarat and Tamil Nadu are some of the state that has announced for implementation by the year 2022.
- The committee has also hired IIM Bangalore so come up with effective project model for making the housing construction more affordable apart from cutting down registration and stamp duties.
New Calculations under the scheme
- According to NHB if their recommendations are accepted by the state governments then the stamp duty charges will be affected to a greater extent cutting down to 5 percent from present 12.5 percent.
- Presently if the buyer has to pay Rs 250,000 as stamp and registration fee for purchasing Rs 20 lakh worth property then after the implementation he will only have to pay Rs 100,000 for purchasing the same property.
Steps taken to compensate lowering duty under housing scheme
- Soumya Ghosh (CEA – SBI) has added that the government needs to look around for other sources of income that can help overcome the compensation due to reduced stamp duty and registration fee rates.
- He also added that the government should consider generating revenue from other sources including increasing tax (VAT) on items like liquor and luxury items.
- Kalyanaraman added that as the VAT would still be under the state government so it is certain that this implementation should help government to generate sufficient revenue that can help accomplish the housing for all mission by 2022. It is also certain that this scheme would help lowering the overall cost of home less than Rs 25 lakh.
Under this scheme it is certain that the overall price for purchasing homes for new home owners will not be considered as a difficult task. With lowering fee duty it is also certain that people may now have to invest only small and affordable amount in purchasing homes.
Under this scheme it is certain that the government aims to provide housing for each and every individual in the country. For this implementation the government has also announced investing big amount of money for new homes.