The government is getting ready to provide investors concerned about the property tax adjustments made to the budget with a significant sense of relaxation. The adjustments that are suggested in the budget will be modified by the government. The amendment states that indexation benefits will still be available to real estate investors.
The administration readied itself for modification
On Tuesday, all of the Lok Sabha MPs received a list of changes that need to be made to the Finance Bill, 2024, or the budget. The budget’s declaration regarding the real estate industry is the subject of the most significant change on the list. In the amendment, the government states that the real estate investors sector should continue to benefit from indexation on property sales in the future as well. In this way, the government is going to correct the change made in the budget to which people had the most objections.
The budget was modified in this way.
The comprehensive budget for the fiscal year 2024–25, which was presented on July 23 of last month. Included a drop in the rate of long-term capital gains tax on property transactions from 20% to 12.5%, according to Finance Minister Nirmala Sitharaman. Nevertheless, indexation’s advantage in determining the tax obligation on proceeds from property sales was also eliminated. These modifications became operative on July 23, 2024, the day the budget was approved. According to the administration, it is working to simplify the capital gains tax. In a news conference following the budget. Finance Minister Nirmala Sitharaman stated that the government has attempted to remove the distinction between different asset classes in the case of capital gains tax by following the advice of the industry. However, many analysts were criticizing the abolition of the benefit of indexation. They argued that this would increase the liability of capital gains tax on investors.
Government revenue comes from LTCG.
The government has found that long-term capital gains tax is a significant source of revenue. It has received Rs 2.78 lakh crore from LTCG over the past five years. The government made 98,682 crore in revenue from long-term capital gain tax in the assessment year 2023–2024 alone. The government-prepared legislation gives investors two ways to pay taxes on the sale of real estate. The previous system will remain an option, with long-term capital gain tax computed at a rate of 20 percent. While indexation will be beneficial. The latter choice will correspond with the changes made in the budget. In which the liability for capital gain tax will be at the rate of 12.5 percent without the benefit of indexation. However, its benefit will be available only for property purchased before 23 July 2024. Investors will be able to choose any of the two options.
Read More: Tata will launch Curvv EV today, know the features and design
| |
  YouTube |          Click Here |
| Â Facebook Page | Â Â Â Â Â Â Â Â Â Click Here |
| Â Instagram | Â Â Â Â Â Â Â Â Â Click Here |
| Â Telegram Channel | Â Â Â Â Â Â Â Â Â Click Here |
