At least this is what the developers community wants. CREDAI MCHI has urged Maharashtra government to revert to reduced stamp duty charges of 2% from 5% in Mumbai.
By Vrim Singh
With property registrations and revenue collections in May down by approximately 70% as compared to March, the real estate industry is looking for options to increase sales.
CREDAI MCHI has written three separate letters to Chief Minister Uddhav Thackeray, Deputy Chief minister Ajit Pawar and Revenue Minister Balasaheb Thorat.
The developer’s body has urged the State Government to reduce the Stamp Duty charges back to 2% in Mumbai till March 31, 2022, stressing on the slowdown in housing sales and drastic reduction in stamp duty revenue collections for the State Government.
CREDAI MCHI believes that this downward trend in real estate sales is set to continue with numerous genuine buyers sitting on the fence due to higher transaction costs, adversely affecting not just the Real Estate industry and its 250+ ancillary industries but also slowing down the momentum of the state’s economic revival in the post COVID era.
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The decision to reduce the stamp duty in August 2020, had brought the Real Estate sector on its path of recovery, with record breaking number of
transactions and revenue collections for the Government up until April, which witnessed a spill over effect owing to transactions from earlier months.
However, the move to not extend the stamp duty rebate beyond March and the outbreak of the second wave has led to extremely subdued homebuyer
sentiments as well as decreased collections for the authorities, with both Property registrations and stamp duty revenue collections down by 70% in May as compared to March, signifying the importance and need of a cut in stamp duty charges to re-galvanize the economy.
Deepak Goradia, President, CREDAI MCHI, shares his comments “The Real Estate sector in Maharashtra and more specifically in Mumbai, was thriving on the back of the stamp duty rebate announced by the State Government in August. CREDAI MCHI had requested for an extension of the reduction beyond March to ensure that the momentum of this industrial and economic revival stays on its tracks. However, in the last couple of months, we’ve seen a steep downward trend in enquiries and sales, hampering not just the steady progress made by Real Estate but also the 250+ ancillary industries which come into play due to industry’s strong multiplier effect. It is now imperative that the State Government realizes the need for a stamp duty rebate to enhance homebuyer sentiments and also increase its own revenue collections which have taken a massive hit in May.”
The developer’s body also recommends stamp duty rate be brought down from 6% to 3% in other regions of Maharashtra.
Now it is up to the state government to decide whether it would reduce the charges or not.