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Know 5 Policies Announced In 2016 That Shook Real Estate

Know 5 Policies Announced In 2016 That Shook Real Estate

Know 5 Policies Announced In 2016 That Shook Real Estate
(Dreamstime)

The realty sector has a very surprising year-end with regard to the policies that have been announced by the Central Government. All the policy announcements have sent the whole sector into frenzy. Some have welcomed the government's move and some others are treading carefully with measured steps. Here are some of the policies that have had a major impact on the real estate sector.

Demonetisation of Rs 500 and Rs 1000 currency notes

The reason given for the sudden decision of making the currency notes of the Rs.500 and Rs. 1000 denominations to be illegal was to put an end to black money. The demonetisation in future would align with the Real Estate (Regulation and Development) Act 2016, RERA announced earlier in the year.

Also read: Govt Bans Rs 500 and Rs 1,000 Notes; Move Will Cure Realty Of Many Ailments In Long Term

Service tax exemption on affordable housing construction

 All the affordable houses constructed in an area of up to 60 sq mt under the scheme of State Government or the Central Government including Public Private Partnership (PPP) scheme would boost the construction in the affordable sector. The exemption in the service tax would encourage the alliance between the public and private sector.

Also read: Service Tax Waiver On Affordable Housing May Be The Best Feature of Jaitley's Budget 2016

Implementation of Goods and Service Tax (GST)

The real estate sector is still speculating if they will come under the purview of GST and whether it will attract the possible tax rates of 18 per cent and 12 per cent. Clarification is also needed whether the existing Value Added Tax (VAT) and the service tax would be assimilated into GST, which are presently levied from the development projects.

Also read: Update: Real Estate Buyers Will Love GST Even If They Have To Pay More

Real Estate (Regulation and Development) Act, 2016

Early in the year in the month of March, the Real Estate (Regulation and Development) Act came into force. The act aims to promote transparency, bring accountability in the realty sector. This act would change the way the real estate sector works in India.

Also read: Time to Act: Part Of Real Estate Law Comes Into Effect

Amendment to the Benami Transactions Act

 In order to curb the rising 'benami' transactions and pulling a plug on black money, the act that came into force on 1st November 2016 will henceforth be called as Prohibition of Benami Property Transaction Act after the existing act of 1988, the Benami Transactions (Prohibition) Act. The Benami transaction indirectly or directly benefits the buyer. This act would bring regulations to deal with disputes arising from such kind of transactions. It aims to make India an attractive investment destination. 

Also read: After Black Money, Benami Transactions To Come Under Scrutiny

Last Updated: Fri Dec 30 2016

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@@Fri Jul 05 2019 13:15:19