CREDAI elevates stamp duty and mentions guidelines value issues with Karnataka’s chief minister.

On February 24, the Confederation of Real Estate Developers Associations of India (CREDAI) raised the issue of stamp duty on registrable documents, guidance value, and excessive statutory charges with Chief Minister Basavaraj Bommai.

According to the officials, the real estate industry has been battered by a variety of issues, including GST, tighter credit availability, rising input costs, and slow commercial real estate absorption. On top of these issues, they claim that several state-specific issues are exacerbating the situation for the real estate industry. CREDAI members proposed revising the methodology for calculating stamp duty on Joint Development Agreements (JDA) and shifting the stamp duty levy from the market value of the property to the construction cost of the project.

They also requested that the time period for a 10% reduction in the Guidance Value of the property be extended by one year, from April 1, 2022 to March 31, 2023. “The Guidance Value should be revisited to account for the value drop caused by the pandemic.” Cities can be classified into different zones/clusters for the purpose of determining Guidance Value,” said CREDAI members.

It was also demanded that the stamp duty on sale deeds be reduced. “The Government of Karnataka must consider extending the benefit of reduced stamp duty of 3% for registration of all residential property for a period of six months in the interest of potential purchasers and developers in the midst of the pandemic.” Such benefits may be extended to stamp duty payable on Sale Deeds registered during such period (i.e., within a 6-month period), as well as agreements to sell entered into between parties during such period in accordance with the RERA-K submission timelines,” they said.