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  1. Realty stocks roar as govt revises LTCG indexation on real estate; Macrotech & Oberoi up 2%

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Realty stocks roar as govt revises LTCG indexation on real estate; Macrotech & Oberoi up 2%

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2 min read | Updated on August 07, 2024, 10:06 IST

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SUMMARY

The NIFTY Realty index was trading 1.1% higher, while the BSE Realty index was up 1%. Brigade Enterprises and Phoenix Mills Ltd were the only laggards.

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The Budget 2024-25 had proposed to lower the LTCG from 20% to 12.5% but removed the indexation benefits.

Realty stocks shot up on Wednesday after the Centre announced relief for taxpayers who bought their houses before July 23, 2024, by allowing them to choose between two tax rates for long-term capital gains (LTCG) tax.

Mumbai-headquartered Macrotech Developers shares were trading 2.1% higher, while Oberoi Realty and DLF gained 2% and 1.7% on the National Stock Exchange (NSE).
Shares of Prestige Estates Projects Limited were up 1.1%, followed by Mahindra Lifespace Developers Ltd at 0.9%, Godrej Properties at 0.8% and Sunteck Realty at 0.2%.
The NIFTY Realty index was trading 1.1% higher, while the BSE Realty index was up 1%. Brigade Enterprises (-0.9%) and Phoenix Mills Ltd (-0.2%) were the only laggards.

The Budget 2024 had proposed lowering the LTCG to 12.5% from 20%, but the indexation benefits were removed. The new rates came into effect on July 23, 2024. The indexation benefit allowed individuals to compute gains from the sale of capital assets after adjusting for inflation.

Tax experts had said that the proposed changes in the Budget would raise the LTCG tax burden.

What amendments has the government made now?

According to the amendments to the Finance Bill, 2024, individuals and Hindu Undivided Families (HuF) who bought houses before Budget 2024-24, i.e. July 23, have the option to compute their taxes under the new tax scheme, which offers a 12.5% tax rate without indexation, or the old scheme, which comes with a 20% tax rate with indexation.

About The Author

WhatsApp Image 2024-06-20 at 9.58.49 AM.jpeg
Kamal Joshi is a business journalist who covers industries, markets and IPOs. He is passionate about breaking news and enjoys playing tennis, where he loves flexing his backhand.

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