Relief for homeowners likely as FinMin may modify LTCG regime

One of the most hotly debated proposals of this year's Budget may see a tweak, with the finance ministry likely to provide relief to homeowners by finetuning the new long-term capital gains (LTCG) provisions announced on July 23 that seek to remove indexation benefits for unlisted assets, including property and gold.

- SHRIMI CHOUDHARY

The changes being considered include extending the effective date of the new regime to the next financial year, instead of the day the Budget was tabled in Parliament. Besides, discussions are going on about grandfathering the purchase of all asset classes, including property, where the indexation provision could apply.

"Some modalities are being worked out in some form in the proposed regime with the intent to provide relief to homeowners," an official privy to the discussions told Business Standard. However, any significant change (tweaks in the rate structure) has been ruled out.

He said there had been deliberations on the issue after the real estate sector gave some data points, claiming that it (the new tax structure) could be detrimental to home owners as well as for the sector.

"The new changes in the works will be accommodated in the Finance Bill," the source added, ahead of its passage in both Houses of Parliament.