The National Real Estate Development Council (NAREDCO) has proposed a significant increase in the tax exemption limit on home loan interest, advocating for a rise to Rs 5 lakh from the current limit. This proposal aims to provide greater financial relief to homebuyers and stimulate growth in the housing sector.
Currently, the tax exemption limit on home loan interest is set at Rs 2 lakh per year. NAREDCO?s proposal to raise this limit to Rs 5 lakh is driven by the need to enhance housing affordability and support the real estate sector, which has faced challenges due to economic fluctuations and rising property costs. By increasing the exemption limit, NAREDCO seeks to make homeownership more accessible and financially manageable for a broader segment of the population.
The proposed increase in tax exemption could lead to substantial benefits for homebuyers, particularly those in the middle-income bracket who are heavily reliant on home loans. With the higher exemption limit, these buyers would be able to reduce their taxable income, thereby lowering their overall tax liability and making home financing more attractive.
For the real estate sector, the proposed change could act as a catalyst for growth by boosting demand for residential properties. A higher tax exemption would likely encourage more people to invest in homeownership, potentially leading to increased sales and development activity within the housing market. This, in turn, could generate additional economic activity and employment opportunities within the sector.
NAREDCO?s proposal also highlights the ongoing need for government support and policy measures to address the affordability crisis in the housing market. By aligning tax benefits with the current economic realities and housing costs, the government can play a crucial role in promoting homeownership and ensuring that more individuals have the opportunity to invest in their own homes.
In conclusion, NAREDCO?s call for raising the tax exemption limit on home loan interest to Rs 5 lakh represents a strategic move to enhance housing affordability and support the real estate sector. This proposed change could provide significant financial relief to homebuyers, stimulate market activity, and contribute to the overall growth and stability of the housing industry.
