The Indian government plans to charge a service tax on sale of homes Indian real estate under construction. This will have a major impact and will raise costs for buyers.

The levy on Indian real estate under construction may increase costs for home buyers by as much as 5 percent, the Confederation of Real Estate Developers’ Associations of India said on Feb. 26. India plans to levy service tax on several real estate-related activities, among other activities.

This is expected to have an effect on investment in Indian real estate, with investors becoming cautious of investing in Indian commercial real estate assets, especially income generating assets, since purchasing such properties on a fixed return basis will now yield significantly lower returns.

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Tags: Indian Real Estate, sales of Indian real estate, tax on Indian real estate sales

This entry was posted on Tuesday, March 2nd, 2010 and is filed under Indian stamp duty and taxation. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.