Sachin
Quick Summary
1. Elimination of Indexation Benefits The FY25 Budget proposes removing indexation benefits for homeowners. This change means that home buyers will pay tax on the entire profit from property sales, without adjusting for inflation. 2. Impact on Home Buyers Increased Tax Burden: Home buyer
Daily Limit Reached
You have reached your daily limit of 2 Free Articles
Subscribe to CCI PRO for unlimited access
Why Upgrade to CCI PRO?
- No Ads
- WhatsApp Broadcasts
- Daily E-Newsletter
- Unlimited Articles Access
BEST VALUE
2 YEAR PLAN
3,499
(Inclusive of GST)
1 YEAR PLAN
1,999
(Inclusive of GST)
View all CCI PRO benfits
Already a PRO member? Login here for an ad-free experience.
FAQ :
The Finance Bill proposes removing indexation benefits for homeowners, which means tax will be calculated on the entire profit from property sales without adjusting for inflation.
Home buyers will likely face a higher tax burden as the full profit, not just the inflation-adjusted gain, will be taxed. This could also increase the overall cost of selling property.
Concerns include a heavy financial burden on home buyers due to increased taxes and the potential for more illicit financial activities in property transactions as people try to avoid higher taxes.
The Income Tax department has defended the move by suggesting it could simplify tax calculations and potentially offer other benefits to taxpayers.
Yes, suggestions include a transition period starting from FY26 to allow individuals time to adjust, or offering a choice between a 20% tax rate with indexation and a 12.5% rate without indexation.
The Finance Bill will be presented for consideration and passing, detailing the implementation. Stakeholders are considering adjustments to mitigate the impact on home buyers.
CAclubindia
