Assocham Suggests Slashing the Stamp Duties
Apr 14, 2017 Legal Guidance
The Associated Chambers of Commerce and Industry of India (Assocham) has suggested the Centre to slash down the stamp duty charges for the residential and commercial properties. This will further reduce the black money and prevent people for undervaluing the property.
According to the chamber, the biggest benefiters of this will be the commercial and residential property buyers. With 6 to 7 percent of stamp duty and other charges like registration and fees of the lawyer, the buyer ends up paying a huge amount for the property.
With the current demonetization, people are forced to withdraw the transaction from their legitimate bank accounts. If the government is forcing people to convert their white money into black, they should at least reduce the stamp duties. This will only result in increase in their revenue rather than decrease. Lower stamp duty will also increase the demand in the real estate sector. The buyers will have to pay lower stamp duties with easier way of getting the titles transferred and the other clearances will be done in transparency.
Hopefully, things will change with the new model. Developers cannot keep greasing the hands of corrupt officials while the buyers pay in all honesty and legitimacy. It cannot be a one way street.
A recent paper from Assocham and Thought Arbitrage gave an insight of how the untaxed money poses a great challenge to the real estate industry.
To get the approvals and clearances from the government bodies, the developers pay them huge sum of money to speed up the process. The buyer at the end has to pay for these bribes with the increase in the price of the property.
This is a very thoughtful step to intensify the crack of black money and be in the favour of the buyers who have to pay a huge amount not only for the property but also have to pay high charges to the government officials, lawyers, contractors, brokers etc for the same.
According to the chamber, the biggest benefiters of this will be the commercial and residential property buyers. With 6 to 7 percent of stamp duty and other charges like registration and fees of the lawyer, the buyer ends up paying a huge amount for the property.
With the current demonetization, people are forced to withdraw the transaction from their legitimate bank accounts. If the government is forcing people to convert their white money into black, they should at least reduce the stamp duties. This will only result in increase in their revenue rather than decrease. Lower stamp duty will also increase the demand in the real estate sector. The buyers will have to pay lower stamp duties with easier way of getting the titles transferred and the other clearances will be done in transparency.
Hopefully, things will change with the new model. Developers cannot keep greasing the hands of corrupt officials while the buyers pay in all honesty and legitimacy. It cannot be a one way street.
A recent paper from Assocham and Thought Arbitrage gave an insight of how the untaxed money poses a great challenge to the real estate industry.
To get the approvals and clearances from the government bodies, the developers pay them huge sum of money to speed up the process. The buyer at the end has to pay for these bribes with the increase in the price of the property.
This is a very thoughtful step to intensify the crack of black money and be in the favour of the buyers who have to pay a huge amount not only for the property but also have to pay high charges to the government officials, lawyers, contractors, brokers etc for the same.
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