As per business sectors release, there is good news for home loaners. During this year, the govt. is deducting the tax by raising tax exemption on interest paid in housing loan.
And now the person, who has taken a house loan, gets double relief from the tax assumption as limiting taxable income up to Rs 3 lakh annually from the existing limit of Rs 1.5 lakh.
And this assumption will be follow up from 16 March 2012 when budget scheduled to be tabled in Parliament.
Double tax deductions upto 1.5 lakhs is allowed towards interest on loans. And a person who borrowed a loan to purchase a house from bank also enjoys tax exemption on the payment of the principal amount.
There is rapid upward movement in the property prices and interest rates with each passing year. It is also affecting GDP rate and for stopping its declining, it have been demanding raising the tax ceiling for housing loans.
It is also expected that the tax exemption limits for each individual on income tax would be increased from the current level of Rs 2.5 lakh to at least Rs 5 lakh. Rs 3 lakh towards interest payments and the remaining Rs 2 lakh should be towards principal loan repayment.
The coming budget would prove to be a big treat for public as Finance Ministry is thinking to raise the limit from Rs 2,000 to Rs 5,000 a month for deductions in the house rent.
Over all once the proposal is accepted, it will result in higher savings and consumer spending as of increasing the disposable income of individuals. Such public preferred budget will really boost the sagging realty sector and lead to enhancing GDP rate.