Realtors happy on the proposal to retain tax exemption on housing loan interest
The much-awaited direct tax code bill, aimed at simplifying the country’s archaic direct tax laws, was passed by the cabinet on Thursday.Those who have a home loan also have reason to cheer, as the interest exemption would continue for up to 150,000 rupees annually.The first draft of Direct Tax Code (DTC) was silent on exemption on interest paid on housing loans. However, after adverse feedback from various quarter, the second draft proposed to retain this exemption, which is also incorporated in the bill.
Realty firms and consultants on Monday expressed satisfaction on the proposal to retain income tax exemption on interest up to Rs 1.5 lakh a year on housing loan, but said the government needs to enhance the limit. Commenting on the development, the country’s largest realty firm DLF Group Executive Director Rajeev Talwar said: “It is good that the exemption has been retained. However, the industry was expecting enhancement of the limit.
The new proposal exempts income up to 200,000 rupees from taxes. For senior citizens, the basic exemption would be hiked to 250,000 rupees. The Housing Loan interest exemption would continue for up to 150,000 rupees annually.But the revised direct tax code was silent on the HRA (house rent allowance) exemption claimed by individuals staying in rented accommodation.
“It is a very good thing that the government has retained the exemption. It will have a feel-good sentiment in the market,” Jones Lang LaSalle Meghraj Country Head Anuj Puri said.
Source:Economic Times
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