With the government slashing corporate tax rate to 25.17 per cent, real estate is hopeful about the impact on the industry.
The overall sentiment in reference to government’s recent rate cut is primarily positive. The general consensus is that the move will most likely push demand for warehousing and commercial real estate. It will also help in bolstering growth of industrial real estate development in the country and is likely to promote affordable housing.
The rate cut is expected to support developers operating in special economic zones (SEZ). Here are what real estate leaders have to say about corporate tax rate cut.
Dr. Niranjan Hiranandani – National President – NAREDCO and Founder & MD – Hiranandani Group
“It is a due corrective step by GoI to uplift investor’s sentiment and prompt investment back in drying up the Indian economy. The move is well intended to revive growth traction of the economy. The fiscal stimulus announced is aligned with ‘Make in India’ the initiative which shall further promote the growth of manufacturing business domestically to help production and eventually impact the consumption.
Rationalization of corporate tax rate sounds to induce more investments now by the corporates further being vital to turn around the economy, which was looming over extremely depressed market sentiments. The positive rally of investor bandwagon instantly reflected bullish in Indian Stock market by Sensex index surging up. This step puts the Indian Corporate tax regime at par with South East Asian Countries, helping economic buoyancy to generate better revenue.”
Ajay Piramal, Chairman, Piramal Group
“The surplus funds available to companies will be invested in capex and talent. The NBFC sector will save between Rs 250 – 300 crore that can potentially be redeployed as loans. In a climate of global slowdown, this reform will make India an attractive destination.”
Shishir Baijal, Chairman and Managing Director, Knight Frank India
“These measures will complement the monetary policy measures taken by the RBI in increasing liquidity and consumer spending. As a trickle – down effect of this, we should be hoping for a revival for the real estate sector as well. This boost will certainly accelerate demand for commercial spaces, but we understand that the financial stability expected will propel growth for the beleaguered residential market in the near future.”
Anshuman Magazine, Chairman and CEO, India, South East Asia, Middle East and Africa, CBRE.
“The lower tax rates shows the government’s commitment towards reigniting the economy’s growth engines and augurs well for the broad economy as well as entrepreneurs. Further, the boost to the manufacturing ecosystem will not only generate jobs and lead to wealth creation but will also have cascading impact on other sectors including real estate and is likely to push demand for warehousing and commercial real estate space.”
Anuj Puri, Chairman – ANAROCK Property Consultants.
“The announcements made by the finance minister will go a long way in not just bolstering all-round sentiments but also see its positive ripple impact across all sectors including the real estate. As and when the overall financial health of the economy improves with these slew of measures, there will be heightened activity within real estate – by both actual home buyers and investors alike.”