Date:06/01/2006 URL: http://www.thehindubusinessline.com/2006/01/06/stories/2006010601310700.htm

Back Seeks tax breaks for housing projects

Our Bureau

New Delhi , Jan. 5

THE National Real Estate Development Council (Naredco) has asked the Government to exempt the income derived from all types of housing projects from income-tax for 10 consecutive years, as in the case of infrastructure projects.

Currently, Section 80IB (10) of I-T Act exempts 100 per cent income from housing projects from income-tax, provided the project is approved before March 2007, and completed within four years from the last day of financial year in which it is sanctioned. The existing clause also states that the project should be on a minimum plot area of one acre.

In its pre-budget memorandum, Naredco said, "Income from all types of housing projects sanctioned by local authorities should be exempt from income-tax for 10 consecutive years as in the case of infrastructure projects under Section 80IA. In case the above is not agreed on, the existing provisions should be changed such that project approval date is extended to March 31, 2010.

"In addition, the completion period be split to four years for projects on a 10-acre land, six years for projects on 10-50 acres land and eight years for projects on more than 50 acre land."

Naredco also called for the removal of the stipulated plot area restriction of one acre.

Citing Section 80 IA of I-T Act, which exempts the income from infrastructure projects from the income tax ambit for 10 consecutive years, it said, "Integrated township development should be brought within the definition of infrastructure, and housing sector should be granted industry status for all concessions and rebates and easy finances for giving proper boost to a very important sector of economy."