In order to boost real estate sector, the Government has taken various initiatives such as reduction in Goods and Services Tax (GST) on under-construction Affordable Housing project from existing 8% to 1% without Input Tax Credit (ITC) and in case of other housing projects from 12% to 5% without ITC; increase in Priority Sector Lending for Affordable Housing Project from Rs. 28 lakh to Rs. 35 lakh in metros and from Rs. 20 lakh to Rs. 25 lakh in non-metros; Setting up of Affordable Housing Fund in National Housing Bank; additional Deduction of Rs. 1.5 lakh on account of Home Loan Interest in addition to the deduction of Rs. 2 lakh for affordable housing, Extension of 100% deduction on profits for construction of affordable housing projects under section 80-IBA of the Income Tax Act till 31.03.2021 and widening the scope of section 80-IBA from 30 to 60 square meters in metros regions and 60 to 90 square meters in non-metros cities.
In order to give relief to homebuyers of stalled projects, a Special Window for Completion of Affordable and Mid-Income Housing (SWAMIH investment fund) has been created for funding stalled projects that are net-worth positive, including those projects that have been declared as Non-Performing Assets (NPAs) or are pending proceedings before the National Company Law Tribunal under the Insolvency and Bankruptcy Code. SWAMIH investment fund will provide last mile funding to the stressed affordable and middle-income housing projects in the country,
Recently, in view of global pandemic of COVID-19, to protect the interest of all stakeholders, Central Government has issued the necessary advisory to all States/Union Territories and their Real Estate Regulatory Authorities for issuance of requisite orders/ directions under enabling provisions of Real Estate (Regulation and Development) Act, 2016 (RERA) to invoke force majeure clause to automatically revise / extend completion date for all real estate projects registered under RERA for a period of 6 months, where completion date expires on or after 25th March, 2020 and to allow further extension of 3 months, if the situation so demands, for the reasons to be recorded in writing and also extend concurrently the timelines of other statutory compliances under RERA.
This was informed by Minister of State (I/C) for Housing and Urban Affairs Hardeep Singh Puri in a written reply in the Rajya Sabha today.