The real estate industry had their own expectations from the Budget 2023-24; announcements such as a slew of policy overhauls and regulatory impetus were expected. However, the Finance Minister refrained from any direct announcement. But the government’s commitment to continuing top-class urban and rural infrastructure development in the form of higher capital investments and dedicated urban infrastructure funds entails positive news for the sector.
The total capital expenditure will be Rs13.7 lakh crore forming 4.5% of the overall GDP. This will translate into an increased investment inflow into sectors such as roadways, construction, water supplies, urban growth, logistics, etc. The government has also announced an increase in the outlay towards Pradhan Mantri Awas Yojana to Rs79,000 crore. The Rs9,000 crore Credit Guarantee Scheme for Micro, Small and Medium Enterprises (MSMEs) will have an immensely beneficial effect on economic growth, as well as help in realising the Prime Minister's vision of 'Housing for All'.
Continuing its focus on urban planning reforms, the allocation of Rs10,000 crore to the National Housing Bank, the highest-ever railway outlay at Rs2.4 lakh crore and increased connectivity through 50 more additional airports will also boost affordable regional connectivity. This momentous initiative will not only have an impact on residential property, but also on commercial, warehouse, retail, and other segments of the real estate sector.
More money in people’s hands
The budget also does justice to the salaried class in the highest tax bracket of Rs30 lakh and above. Previously, the effective taxation at the highest slab was estimated at 42.74% which has been revised. The current budget proposes to reduce the surcharge from 37% to 25% for the highest slab coupled with the proposal of standard deduction of Rs50,000. Ms Sitharaman explained that individuals earning more than Rs 15.5 lakh per annum stand to benefit by at least Rs52,500. This will translate into more money with people to spend on their dreams, which may in turn, boost the housing sector.
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