1% metro cess on property buys in Pune from next month, realtors oppose

PUNE As the government is contemplating metro cess on property purchases from April 1 in Pune, Mumbai and Nagpur, the real estate lobby has opposed the move

PUNE As the government is contemplating metro cess on property purchases from April 1 in Pune, Mumbai and Nagpur, the real estate lobby has opposed the move.

As the government is contemplating metro cess on property purchases from April 1 in Pune, Mumbai and Nagpur, the real estate lobby has opposed the move. (REPRESENTATIVE IMAGE)

The state government, according to officials, is planning to levy 1% on purchase of properties where Metro rail has started. If imposed, stamp duty will increase up to 6% in Mumbai and 7% in Pune, Thane and Nagpur.

Anil Pharande, President of CREDAI-Pune Metro says the pandemic-hit real estate industry, which is already struggling due to the raw material price rise will be hugely affected This cess will be for funding the Metro rail projects and transport-related projects in the state.

The state government had earlier imposed 1% stamp duty in the name of metro cess in all cities where the Metro work is under construction since 2017. It was, however waived off by the government for two years due to the pandemic, but as per the latest instruction from the government, it may be re-implemented from April 1, 2022.

Pharande said, “The already existing 1% local body cess and the additional Metro cess of 1% will mean direct increase in purchase price of properties by a lakh to few lakhs, which accordingly will impact the consumers who are looking to buy their dream homes. The after effects of Covid have not yet been eliminated and the industry may not be able to rise again from the shock of this price rise.”

The Association has already submitted a letter of appeal to Maharashtra revenue minister, Balasaheb Thorat and have suggested to charge metro cess after all lines are fully functionally. The cess should be charged at a reduced rate.

“The rise in raw material prices has already raised input costs by ₹300-400/- per sq ft. Also, the cost of crude oil prices has gone up due to the on-going Russia-Ukraine war. In construction, the transport cost accounts for about 15-20%, which will also have an adverse impact on the input costs and developers will have no option but to hike the prices to sustain,” said Pharande.