The reduction in stamp duty will remain in effect till March 31, 2023, according to the Government of West Bengali. To aid in the market’s recovery from the ongoing epidemic, a two percent stamp duty discount and a ten percent circle rate relaxation were added. This remission on stamp duty 2021 will last until March 2023.
How does the Policy work?
The West Bengal government has decided to prolong the deadline for levying stamp duty on discounted rates to March 31, 2022 in an effort to stimulate the residential real estate industry. The stamp duty cut by 2% and the circle rate relaxation of 10% were first postponed from October 30, 2021, to January 20, 2022. Due to the ongoing epidemic, these cutbacks have been postponed a third time, this time until the end of March 2022.
How to Get Benefit from Reduction in Stamp Duty by the Government
For a while now, home buyers have had an incredibly favourable opportunity to purchase their ideal homes. The interest rate on mortgages is currently rising. Despite the fact that it is unlikely to decrease any more, the interest rate cycle may begin to rising more from this point onward due to the heightened risk of inflation rearing its ugly head. Additionally, in response to the Covid second wave, the West Bengal government established a short-term policy of reduced stamp duty and circular rates, which will immediately relieve homeowners’ financial burdens.
In the past, Kolkata’s urban and rural areas paid 6% and 5% respectively, in stamp duty. After the financial relief, the stamp duty is now 4% for properties up to Rs 1 crore in urban areas and 3% for rural areas. Additionally, 1% percent for urban regions and rural areas are applied to properties valued at more than Rs 1 crore.
According to the decision from the West Bengal Finance Department, because to the ongoing economic downturn brought on by the COVID 19 epidemic, the Finance (Revenue) Department has decided to postpone the implementation of both stamp duty and circle rate reduction until March 31, 2022. The decrease will result in more business activity, continued assistance for homebuyers, and the creation of jobs.
Following the reductions in stamp duty and circle rates, sources claim that the residential real estate sector in Kolkata has seen an increase in house registrations. Greater Kolkata registered 44,940 residential units, up 64 percent from the registration figures for 2020, with 56 percent of these units being registered after the announcement of the stamp duty reduction in July 2021.
Significant Benefit, Limited Window of Opportunity
Property Buyers who have been holding out on making an offer on their ideal property for even longer ideal times must end their wait now. There is little chance of further interest rate reductions. Additionally, a general increase in the price of raw materials like steel and cement suggests that home prices would likely grow in the near future.
Due to the necessity to strengthen its finances, the government is also likely to withdraw some of the financial incentives that were previously announced.
So, before the window of opportunity closes, prospective purchasers must take action quickly.
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