This year’s Budget aims at inclusive growth taking PM Modi’s Sabka Sath Sabka Vikas agenda forward by making States an equal partner in economic growth.
The infrastructure sector has been given focus by introducing tax free bonds for rail, road and irrigation projects. The PPP model for infrastructure development is a good step. We welcome REITs but lament the impact of tax increase on construction. REIT units will be taxable in the hands of unit holders and the sponsor of REIT Special Purpose Vehicle is allowed a pass through status in taxation on rental income. This shall monetise existing real estate assets as well as attract new investment. The cost of housing, however, will go up by the increase in service tax on construction and excise duty on inputs. This adds to the pressure on real estate developers.
The writer is CMD, Raheja Developers Ltd