Mini budget may give tax breaks on housing
The Times of India, February 12, 2009, Page 1
Prabhakar Sinha, TNN
NEW DELHI: The interim budget to be announced on Monday could bring some cheer to consumers and investors, as acting finance minister Pranab Mukherjee may use the opportunity to announce one more stimulus package in the form of targeted tax incentives.
Sources in the government told TOI that Mukherjee may announce tax sops aimed at boosting the housing sector, which has been identified as a potential driver for the economy and job creation during a slowdown.
Normally, propriety would demand that an outgoing government not announce any major policy decisions or changes in the tax structure in an interim budget. But, given the global economic crisis and its impact on India, the UPA has the opportunity to argue that it cannot remain a silent spectator and allow things to drift for months till the new government can assume office.
One populist measure that is being seriously considered to kick start the realty sector -- which could help revive a number of related sectors like steel, cement and electric appliances -- is an increase in the deduction allowed for payments on housing loans.
The Times of India, February 12, 2009, Page 1
Prabhakar Sinha, TNN
NEW DELHI: The interim budget to be announced on Monday could bring some cheer to consumers and investors, as acting finance minister Pranab Mukherjee may use the opportunity to announce one more stimulus package in the form of targeted tax incentives.
Sources in the government told TOI that Mukherjee may announce tax sops aimed at boosting the housing sector, which has been identified as a potential driver for the economy and job creation during a slowdown.
Normally, propriety would demand that an outgoing government not announce any major policy decisions or changes in the tax structure in an interim budget. But, given the global economic crisis and its impact on India, the UPA has the opportunity to argue that it cannot remain a silent spectator and allow things to drift for months till the new government can assume office.
One populist measure that is being seriously considered to kick start the realty sector -- which could help revive a number of related sectors like steel, cement and electric appliances -- is an increase in the deduction allowed for payments on housing loans.
BOOSTER DOSE
1. Tax deduction on interest payments on housing loans may be raised from Rs. 1.5 lakh to Rs. 2 lakh.
2. This could enable those who have bought a house for self-use to save up to Rs. 68,000 in tax from a maximum of Rs. 51,000 at present.
3. Another possible sop could be exempting corporates from tax on profits earned by building small dwelling units.
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