According to sources in finance minister, the center is likely increase income tax exemption limit in forthcoming general budget. Government is considering a proposal to hike income tax exemption limit to boost demand and rebuild the slowdown-hit housing industry.
At present tax payers are eligible for exemption of income tax on interest rate paid up to Rs 1.5 lakh every year and it is likely to increase to Rs 2.5 lakh a year. If the proposal is accepted, tax payers will save up to Rs 31,000 a year from income tax exemption this will make purchasing home more affordable. However, tax payers can get this benefit only after construction of house is completed.
While acknowledging the fact that a “marginal” hike in the income-tax exemption limit will lead to some revenue loss, the Tax Research Cell (TRC) believes that the very injection of a “feel good” factor into the economy will have a positive spiraling effect on the “demand dynamism.”
Reference
Tags: Apartment, apartment buy-sell, Bangalore, Home Loans, Housing India, income tax, market trend, property, Real Estate India, recession, Tax calendar
