Ashwin Reddy MD Aparna Enterprises Ltd on Budget Expectations
We are expecting a thorough examination and revision of GST rates of building materials. Rational and uniform GST rates should be brought to the forefront. For instance, cement is placed at 28% which exorbitantly high for retail consumers. The government should think of segregating the rates for a B2B consumer and a normal B2C consumer.
The government has recently hinted that all the building materials will be brought to a 5% GST slab. If the proposal is really executed, it will bring a big transformation to the construction sector. This will also ease the burden from the small traders. If this revision can be followed with other building materials such as sanitary ware, insulated wire and ceramic tiles; a reduction in GST on building materials will help consumers to go for housing at good budgets without burdening themselves.
The existing Pradhan Mantri Awas Yojana scheme has to be made little more flexible for rural areas and semi-urban areas. The government should introduce slab systems in terms of tax incentives in such areas. The dream to own a house is still elusive for certain segments and it’s up to the government to revise its tax structure for first-time homeowners.
The government should also plan to invest more in the infrastructure. This will not only attract investments but also boost construction and building materials industry in general. Finally, the government should introduce flexible income tax incentives for the affordable housing industry, thereby reducing the indirect financial burden on buyers.
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