Stamp duty cut across Karnataka for flats up to Rs 45 lakh | Bengaluru News – Times of India


BENGALURU: In a boost to the beleaguered real estate industry, the cabinet on Thursday decided to reduce stamp duty charges from 5 per cent to 3 per cent for flats priced up to Rs 45 lakh. It also resolved to form a committee to study the pandemic-hit sector’s demand to reduce the guidance value of properties.
“We will take the final call based on the committee’s report,” said law and parliamentary affairs minister Basavaraj Bommai.
The decision on stamp duty is expected to help increase property registrations and lift the sentiment in the affordable housing segment across the state. In May 2020, the government had slashed stamp duty on homes priced between Rs 21 lakh and Rs 35 lakh by the same rate. In the 2020-21 budget, units costing up to Rs 20 lakh saw a decrease.
The initial plan was to lower charges for only properties priced up to Rs 20 lakh, but the government realised the incentive would not spur demand in urban centres like Bengaluru, where such lowcost units are difficult to find. It finally decided to expand the purview of the cut to the Rs 35-lakh price range and now to Rs 45 lakh.
Though pleased with the government’s decision, real estate developers believe it may not have a significant impact on demand. According to Suresh Hari, the chairman of CREDAI’s Bengaluru chapter, affordable housing accounts for about 20 per cent of real estate development in the state. “While we welcome the move to cut stamp duty, which will help lower middle-class and first-time homebuyers, the market requires a flat cut across all segments,” he said.
Hari added that after the second wave of Covid-19, the real estate market was finding it challenging to pick up the pace, while would-be buyers were still concerned about how the pandemic would affect their financial status.
Amid chatter that chief minister BS Yediyurappa, 78, may make way for a younger leader, the cabinet has cleared another major proposal. The plan will involve the construction of 5 lakh houses — 4 lakh in rural Karnataka and 1 lakh in urban locations —
under various housing department schemes. Bommai said that the project would be completed in the next two years and was estimated to cost Rs 8,000 crore.

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