New budgetary provisions will hit buyers, says chamber
KOZHIKODE: The Malabar Chamber of Commerce has said the new levies on housing sector imposed by Finance Minister T.M. Thomas Isaac in his latest budget would hinder the growth of the sector. It would also dash the hopes of the middle-class who wished to own a house.
President of the chamber of commerce P. Zakeer, in a representation to Dr. Isaac, urged him to either revert to the old tax rates or reduce the rates.
"The new tax rates on flats will retard the growth of the housing sector and force investors to look for flats in neighbouring States, where the tax rates are much less," he said.
The memorandum also said the new budgetary provisions would affect the buyer and not the builder. All that the flat-builders were required to do was collect the tax from the buyer and remit it to the treasury.
The hike in the tax had come at a time when many people were opting for flats owing to the high price of land and rising construction costs. "Placing the burden of high tax on flats is unbecoming of a Government which has promised a home for all within five years," Mr. Zakeer added.
The chamber spokesman said the stamp duty, inclusive of the registration tax, worked out to nearly 15.5 per cent in Kerala.
In other States, the land price and cost of flats were considered for calculating the stamp duty and registration charges. Despite this, the total tax came to just two to eight per cent.
The tax imposed in the State would cause the price of flats to soar.
It would also hit the nearly two-lakh workers who depend on the construction sector for a living. It might also force non-resident Malayalis to invest in flats outside the State.
Mr. Zakeer said the housing sector, which contributed nearly Rs.500 crore to the State exchequer annually and disbursed nearly Rs.1,000 crore as wages each year, deserved a better deal.