Reforms in Bengal Real Estate Sector Urged Before Union Budget
As the Union Budget 2025 approaches, real estate stakeholders in West Bengal have voiced a compelling call for policy reforms aimed at catalysing growth in the sector. Acknowledging real estate as India’s second-largest employment generator, industry leaders emphasised the need for initiatives that balance housing affordability, urban development, and infrastructure growth. This comprehensive push for change reflects the sector’s pivotal role in the country’s economic framework, with stakeholders like Sushil Mohta, President of CREDAI West Bengal and Chairman of Merlin Group, highlighting sustainable infrastructure development as a national priority.
Developers have proposed revising the definition of affordable housing to expand its benefits. This includes raising the price cap for affordable units from ₹45 lakh to ₹90 lakh, with an annual 5% increment to align with inflation. Another key recommendation involves introducing a credit guarantee scheme for housing loans up to ₹70 lakh, covering 80%-90% of property value, and home improvement loans up to ₹30 lakh. To ease financial burdens on homebuyers, industry experts called for an increase in the interest deduction limit for first-time homeowners from ₹2 lakh to ₹5 lakh and exempting annual rental income up to ₹20 lakh from taxation. Simplifying the GST structure to a single rate of 1% for all housing units also remains a priority for builders.
From a sustainability angle, the sector has urged for the reintroduction of the Credit-Linked Subsidy Scheme (CLSS) under the Pradhan Mantri Awas Yojana (PMAY), particularly for the youth below 40 years. Providing subsidies of 3%-4% on housing loans would make homes more accessible while fostering community development. Reducing long-term capital gains tax to 10% and lowering the holding period for property eligibility to 12 months were also highlighted as critical measures. Additionally, stakeholders recommended standardising and reducing stamp duty rates across states, offering rebates to first-time homebuyers to stimulate growth.
Civic and urban development advocates have underscored the importance of these reforms to ensure housing remains a fundamental right rather than a luxury. Reducing tax burdens and simplifying GST structures would empower middle-class families to invest in homes while creating a ripple effect on job creation and economic progress. Furthermore, a unified approach to stamp duty and infrastructural expansion would enhance urban mobility and environmental sustainability. With real estate integral to achieving India’s growth ambitions, the proposed reforms align with long-term economic and ecological goals.
