GOA: Govt hikes infrastructure tax, housing cost to rise

GOA: Govt hikes infrastructure tax, housing cost to rise

The hike in infrastructure tax is quite steep and will significantly increase construction costs, industry sources said.

THE GOAN NETWORKUpdated: Friday, April 07, 2023, 02:20 PM IST
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GOA: Govt hikes infrastructure tax, housing cost to rise | Representative Image/ File

In a move that could significantly impact upwardly the cost of construction and housing, the State government has hiked the infrastructure tax of constructions higher than 101 square meters from Rs 200 to Rs 350 in the top 'category A' in coastal panchayats and the five major towns of Panaji, Mapusa, Ponda, Margao and Mormugao.

The infrastructure tax rates, charged under the Goa Tax on Infrastructure Act, are per square meter of built-up area, which add up to a significant amount on the overall residential building.

The hike in infrastructure tax is quite steep and will significantly increase construction costs, industry sources said.

"The costs will be eventually passed on to the buyer which will definitely impact housing costs," a member of CREDAI-Goa told The Goan.

About the categories

In addition to the 'category A' constructions in the coastal villages and the five major cities/towns, another 'category B' has be carved out for constructions in municipal towns, census towns and village panchayats whose jurisdictions are contiguous to the 'category A' areas.

For 'category B' the infrastructure tax has been hiked from Rs 200 to Rs 300, the notification states.

A third 'category C' will involve constructions in other village panchayat areas. Here, the infrastructure tax has been increased from Rs 200 to Rs 250.

Infrastructure Tax is also applicable to commercial buildings, industrial buildings, other buildings, infrastructural projects and facilities. These categories of constructions will also be liable to the revised rates of tax.

About the new tax rules

Meanwhile, the State government has also notified new rules for tax assessment on properties in municipal areas. These rules have come into effect from April 1 this year 2023.

According to these new rules, property tax payable for new residential buildings shall be 0.15 per cent of the capital value of such building to be assessed annually.

For new commercial buildings the property tax will be 0.25 per cent of the annual capital value of the building.

Housing is a sensitive matter in Goa and its high costs has put owning a dwelling is largely seen to be beyond the reach of an average Goan.

Industry sources said a vast majority of units in any new construction is mostly picked up by the outstation buyer who are usually investors from the metros, particularly Mumbai and Delhi, and other tier-II cities of the country.

"This demand from the outstation investors is what is putting pressure on prices of housing for the local," the source said.

The government meanwhile had tweaked the Town and Country Planning Act, during the winter session of the Goa legislative assembly in January this year by which the Chief Town Planner was empowered to make changes in the Regional Plan on the government's instructions and 'inclusive housing' was one of the objectives.

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