Realty sector seeks tax breaks on REITs in line with MFs
Source: Economic Times
MUMBAI: Realty sector hopes that Finance Minister P Chidambaram will provide tax breaks on REITs in line with the Mutual Funds while he unveils the Union Budget on February 29. Market regulator SEBI has already come out with a draft guideline to allow Real Estate Investment Trusts (REITs), but there was no mention on the tax breaks that is imperative to popularise the REIT market to start with like any other global market. "I believe that income of the investors under REIT should not be taxed, like in the US. This will attract investors to further invest in REITs," Ansal API Chairman Sushil Ansal told PTI. The country needs to introduce REITs as soon as possible, he said adding that this would help to bring in funds to the sector. "All the benefits that the Mutual Fund industry enjoys should be made available to REITs as well. Long-term capital gains on sale of REIT units could be made tax exempt and short-term capital gains could be taxed at 10 per cent, in line with equity-oriented mutual funds," Orbit Corporation's CEO and Managing Director Pujit Aggarwal said. Stating that the launch of REITs would enable the sector to take it to the next level, city-based real estate players feel REITs would boost the demand and development for 'investment grade' commercial buildings in the country.
MUMBAI: Realty sector hopes that Finance Minister P Chidambaram will provide tax breaks on REITs in line with the Mutual Funds while he unveils the Union Budget on February 29. Market regulator SEBI has already come out with a draft guideline to allow Real Estate Investment Trusts (REITs), but there was no mention on the tax breaks that is imperative to popularise the REIT market to start with like any other global market. "I believe that income of the investors under REIT should not be taxed, like in the US. This will attract investors to further invest in REITs," Ansal API Chairman Sushil Ansal told PTI. The country needs to introduce REITs as soon as possible, he said adding that this would help to bring in funds to the sector. "All the benefits that the Mutual Fund industry enjoys should be made available to REITs as well. Long-term capital gains on sale of REIT units could be made tax exempt and short-term capital gains could be taxed at 10 per cent, in line with equity-oriented mutual funds," Orbit Corporation's CEO and Managing Director Pujit Aggarwal said. Stating that the launch of REITs would enable the sector to take it to the next level, city-based real estate players feel REITs would boost the demand and development for 'investment grade' commercial buildings in the country.
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