Starting from April 1, Mumbaikars to pay 5% stamp duty, women will pay 4% on a home purchase. The government decided to not extend the stamp duty conncession.
By Varun Singh
No this isn’t an April Fool’s joke. It is a harsh reality that has struck the realty industry hard.
The real estate industry was expecting that the government will continue its stamp duty conncession even in April and few months ahead.
However, it hasn’t happened so, the government on Wednesday announced that it will not extend the stamp duty concession.
In August last year, the state government had announced, a 3% cut in stamp duty between September 1 to December 31, 2020.
The cut was 2% between January 1 to March 31, 2021. The real estate industry had tried its best to get it extended.
This means that from April 1, a homebuyer in Mumbai will have to pay a stamp duty of 5%. For women it will be 4%.
The news of no extension hasn’t gone down well with the real estate industry.
Dr Niranjan Hiranandani – MD- Hiranandani Group and National President- NAREDCO said, “The extension of this bolster benefit would have played a catalyic role in keeping up the pace of sales and property registration momentum across the micro markets and different housing segments in the state. Also, the proven data clearly reflected uptick in volume leading to increased state revenue in last H2 Fy20-21 and multiplier effect it draws on employment and GDP.”
Builders sounded very upset, with the move of the government not extending the stamp duty cut.
Deepak Garodia, President, CREDAI MCHI said, “We are disappointed with the Maharashtra Government’s decision to not extend the stamp duty rebate beyond 31st March. Given the current economic climate, the reduction in stamp duty charges not just galvanized homebuyer sentiments but also enabled the industry to spearhead the state’s economic revival in the post-covid era as well. An extension would have ensured the sustenance of the sales momentum while providing the necessary support to one of the strongest economic pillars and employment generators in the country.”
However, builders also claimed that they will continue dialogue and representation with the necessary authorities to resume the reduced 3% stamp duty rates in the near future and safeguard the best interest of all stakeholders involved.
The government also kept the ready reckoner rates unchanged, which the real estate community called as a good move.
Hiranandani said, “Unchanged ready reckoner rates is good, but Industry expected reduction in ready reckoner rates to foster real estate transactions. Hence, Naredco requests state government to kindly reconsider the decision,proving it to be a win-win situation for all.”
March Sees Over 17.7K Sales in Mumbai
According to data accessed from Department of Registration and Stamp, March month saw a total sales of 17,728 units.
These sales generated a revenue of Rs 874 crore for the state government in the form of stamp duty and registration fees.
However, it is expected that the sales will decline from April 1 with stamp duty rates coming back to normal.
The sales figure of March is the second highest in the history of real estate industry.