Key Highlights of the Union Budget 2023 for Real Estate
The Union Budget 2023 was announced by Finance Minister Nirmala Sitharaman on February 01, 2023. This budget was first to be announced during the Amrit Kaal. The budget for 2023 is completely focussed on infrastructure development. The minister while delivering her budget speech, has notified an array of reliefs that includes a new tax regime, urban development schemes etc to benefit the middle class and salaried individuals.
With this, the real estate budget for 2023 has also a lot to offer to the industry. In this article, we have discussed the key takeaways and measures announced for the real estate industry.
Key Announcements of Real Estate Budget 2023
In a bid to improve the real estate market, the Finance Minister has proposed a lot of schemes and initiatives in Budget 2023. These measures promoted affordable housing, and the key announcement will increase the ease of doing business within the real sector industry.
PMAY Yojana
The finance minister proposed to revise the outlay of the PM Awas Yojana as per the real estate budget 2023. The government has increased the expenditure on this scheme by 66% which totals Rs 79,000 crores. With this, the government wishes to promote affordable housing in the country.
Capital Gain Calculation Formula Revised
The Finance Minister has also suggested an array of guidelines citing which the norms of capital gains have slightly changed. The government has proposed this for joint property development and the money that is received via cheque or other payment modes.
Capital Gains Deductions Capped
Tax exemptions against capital gains have been also proposed under the real estate budget 2023. The tax deduction will be applicable on investment in housing under sections 54 and 54F. These deductions are applicable only upto Rs 10 crores. The FM has also proposed to revise the rules of computing capital gains on money received via any mode.
Municipal Bonds
As per the real estate budget 2023, the government will lay out rules to increase the creditworthiness of the cities via municipal bonds using ring-fencing charges on urban infrastructure and property tax.
Exemptions for Development Authority
As per the real estate budget 2023, the government has proposed for exemption on income that arises from a body or trust constituted under the central or state Act. The body signifies the purpose of housing, development, and improvement of cities or villages.
Urban Infrastructure Development Fund
With the Union Budget 2023, the finance minister has emphasised the development and urban planning of tier 2 and tier 3 cities. To fulfill this purpose, the government has proposed to set up the Urban Infrastructure Development Fund (UIDF) and a core committe of economists and urban planners. This fund will be managed by the National Housing Bank and an outlay of Rs 10,000 crores has been proposed. These committees will recommend urban planning policies, governance etc. Along with this, the centre has also proposed around five centres of excellence for urban planning.
Developing Sustainable Cities
The Finance Minister has also proposed to create sustainable cities. The government has proposed that the states and cities undertake urban planning and reforms. With this, the real estate budget envisages going efficiently using land resources, development and availability and affordability of urban land.
Other Highlights of Union Budget
Here are some key takeaways from the Union Budget 2023:
- The Finance Minister has introduced a new tax regime as per which the rebate limit has been increased upto Rs 7 lakh.
- The deduction of salary class and pensioners has increased upto Rs 52,000
- The upper limit of the Senior citizen saving scheme has been increased to Rs 30 lakh
- PAN Card is now a common identification tool and the government will simplify the KYC norms as well
- The government allocates Rs 5.94 lakh crore to Defence and Rs 1.62 lakh crore to be spent on the acquisition of new weapons, hardware etc.
- The agricultural credit target has been raised upto Rs 20 lakh crore
- The FM has announced Rs 75,000 crore for 100 transport infra projects
- Allocation of Rs 10,000 crore for urban infrastructure funds annually
Real Estate Budget 2023 FAQs
What is the key announcement for the real estate budget 2023?
As per the Union budget 2023, the government has announced a revised outlay for the Pradhan Mantri Awas Yojana.
What is a Municipal bond?
The government has announced initiatives for municipal bonds to increase the creditworthiness of the cities.
What is the proposed Capital Deduction as per the Real Estate Budget 2023?
The tax deduction will be applicable on investment in housing under sections 54 and 54F upto Rs 10 crore.
What announcement has been made regarding urban infrastructure development?
The government has proposed to set up the Urban Infrastructure Development Fund (UIDF) and a core committe of economists and urban planners that will be managed by the National Housing Bank.
What is the new tax regime as per Budget 2023?
As per the new tax regime, the rebate limit for income tax has been increased to Rs 7 lakh.
