The state government is under pressure to reduce stamp duty and registration charges for all properties in a bid to give a leg-up to the realty sector.
In May, the state reduced the registration stamp duty from 5% to 3% for properties costing between Rs 21 lakh and Rs 35 lakh. Last year, the government had brought down the stamp duty from 5% to 2% for properties costing up to Rs 20 lakh.
Trade bodies and home buyers are now urging the government to reduce stamp duty and registration charges from 5% to 3% for all properties above Rs 21 lakh.
Reducing stamp duty will help boost realty revenue: Traders
Trade bodies and home buyers say reducing the stamp duty and registration charge for all properties above Rs 21 lakh will help the real estate sector and boost its revenue from property registrations.
Revenue department officials said the government was sympathetic to the demand and a decision would be taken at the higher level. “We hope to recover the losses with postponed property purchases expected to open up. The government is open to looking at all measures, including lowering the duty,” said revenue principal secretary Anjum Parvez.
The stamp duty and registration charge (1% of the property value) are the two components of the levy imposed on home buyers. Trade bodies and individual customers say the recent reduction in the stamp duty is not enough to stimulate the Covid-hit housing sector. “Buyers have postponed their plans. The government’s move to reduce the stamp duty will encourage them to register properties. Hence, it is the right time to cut the duty,” said Suresh Hari, chairman of CREDAI-Bengaluru.
The Federation of Karnataka Chambers of Commerce and Industries (FKCCI) has written to the revenue department seeking reduction in stamp duty. “Property registration is seen to be slowly gathering pace. The government must take more proactive measures,” said FKCCI president CR Janardhan.
According to FKCCI data, some 88,450 flats were ready for registration when the government imposed lockdown in March. About 8,000 flats were registered after the restrictions were lifted and the government revenue jumped from Rs 30 crore in April to Rs 398 crore in May. This went up to Rs 746 crore in June before sliding down to Rs 607 crore in July that saw a week-long lockdown.
