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Relaxation of tax structure sought
June, 26th 2015

Professionals in the construction sector fear that ‘Housing for All’ may fizzle out like ‘Affordable Housing’ which never took off in Mysuru due to various factors. Besides a higher Floor Area Ratio (FAR) and low land cost the builders have pointed out that taxation is an important component in housing.

According to the Builders Association of India, service tax in the State was 14 per cent while VAT attracted another 14.5 percent. In addition there was labour cess, registration charges and stamp duty all of which adds to cost per unit and is passed on to the buyers. “Tax in various forms accounts for about 35 per cent of the unit cost which are passed on to the buyers,” said Ravindra Bhat, Chairman, BAI, Karnataka. The government failed to reduce the tax structure besides failing to provide land at affordable rates, he added.

Though BAI and other stakeholders sought a higher FAR in the Mysuru Master Plan it was denied but the government now proposed to revise it or rework it. NGOs has cautioned the authorities against permitting high-rise buildings in the existing localities earmarked for individual row houses as the civic infrastructure cannot cope with additional load.

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