If the government’s latest proposal passes, Mumbaikars will have to brace themselves to pony up additional one per cent stamp duty on sale, gift and mortgage of immovable property. The state urban development department has moved a bill to amend the Mumbai Municipal Corporation Act that will levy a surcharge by way of stamp duty in Greater Mumbai. It aims to use the revenue generated to finance urban transport projects, including Metro, monorail, bus rapid transport system, freeways and sealink, which entail investment of more than Rs 1.06 lakh crore. However, the realty industry has warned that it will severely impact the sentiments of buyers and affect the already-down property transactions.
A state law & judiciary department officer told DNA,” The bill has been moved by the urban development department on July 19, but could not be taken up for discussion during the Monsoon Session of the state legislature, which concluded last week. However, the government may issue an ordinance or table the bill during the Winter Session slated to begin on November 19.”
An officer from the state urban development department said they expect that the government may mop up an additional Rs 500 crore to Rs 800 crore with the proposed hike.
“This move was in discussion since mid-2017, but the bill has been crafted now,” he said.
Nirmal Group director Rajeev Jain said the hike on the existing 5 per cent will increase the cost of the transaction of real estate deals, and will have an adverse effect on the already difficult market. ”The change in stamp duty percent will affect the buyers, mainly aspiring millennials, as it will affect their budget,” he noted.
According to Builders Association of India’s senior member Anand Gupta said the government’s move will further burden the realty industry. ”Currently, the realty industry is suffering from low sales, liquidity crunch and mounting NPAs. Additional stamp duty will adversely impact the sale of homes in affordable and luxury segments. This should have been avoided,” he said.