How Union Budget 2017 affects HM homes?
Having witnessed a prolonged slowdown and hit hard by the recent demonetization drive, the real estate sector was betting big on the Budget 2017 for revival of fortunes. It was expecting, among other things, income tax incentives for first-time home buyers apart from higher tax savings on housing loans and house insurance premiums and industry status for the sector. However, the budget not only missed out on these things, but with its proposals it is also believed to have discouraged investors from investing in second or more homes. First, the budget has proposed to cap tax breaks on interest paid on rented homes at Rs 2 lakh a year. Earlier the entire payment of interest on a housing loan taken to buy such a house was allowed to be set off from the gross income. Secondly, the budget has made a provision that payment of house rent exceeding Rs 50,000 a month has to be accompanied by a 5 percent TDS (tax deduction at source). This means that people who could have made substantial sa