The state assembly passed a bill extending the set-off (adjustment) period for stamp duty payment from one year to three years for every new property resale. Accordingly, the stamp duty would be payable only on the price difference of a property instead of the entire amount for a period of three years.
Explaining how it works, advocate Vinod Sampat said, “Suppose an investor purchases an apartment for Rs 30,000 a square foot in 2022. In 2025, when the investor sells it for Rs 32,000 a sq ft, the stamp duty will be payable only on the difference of Rs 2,000. ”
Earlier, this benefit was given for flats sold within one year of purchase. The bill passed on Wednesday said there were negligible cases of flats resold within one year.
The state’s rationale is that due to a fast-changing global economy and the post-pandemic situation, it is necessary to encourage businesses.
If any concession to be earned is extended for up to three years, such benefit will be availed by a larger number of investors, stated the bill.
The decision will not only enhance the number of investments but also boost sale-purchase deals, benefiting the huge revenue that the state earns through stamp duty, it added. The bill further stated the move will encourage the construction business and eventually bring in more job opportunities for youths in the state.
Revenue minister Balasaheb Thorat said several representations made by the real estate industry indicated the losses they were making, especially in the post-Covid period. “The decision will encourage investors into boosting real estate deals and, in turn, help the state generate more revenue and employment,” he added.
Cooperatives expert Ramesh Prabhu said this move to extend the resale time for stamp duty concession from the earlier one year to now three years will help investors not only earn more appreciation on their properties but also save on income tax as properties sold after two years for buying a bigger one within a year’s time are bound to get I-T exemption.
Earlier the sop was for resale in a year.