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Rehab for housing sector secondary market

TRehab-logo2-copyhe nation’s realtors have proposed that the government introduce a secondary market for the real estate sector, slash flat registration taxes and continue the existing facility to legalise “undisclosed” money.

The Real Estate and Housing Association of Bangladesh (REHAB) leaders made the call at a pre-budget meeting on Tuesday with the National Board of Revenue (NBR). The board chairman Ghulam Hussain chaired the meeting.

The association leaders claimed that the investors could not garner the opportunity to legalise the undisclosed money this year due to political turmoil.

The REHAB members sought continuation of the facility to declare undisclosed money through investment in purchase of flat for the next five years. They also proposed that the government allow investors to purchase first flat without showing source of the income.

REHAB vice president Liakat Ali Bhuiyan said the real estate sector has faced headwind this year due to deadly political violence.

The association leader said registration cost of flat and land is high in Bangladesh compared with other countries in the SAARC region, which is driving away investors and discouraging them to register property in this country.

He said the realtors have been struggling hard due to substantial increase of prices of land and construction material.

The REHAB leader also proposed that the board reduce tax at source to Tk 1,000 per square feet from the existing Tk 1600 for Gulshan, Banani, Baridhara, Motijeel residential area. For non-residential area of those zones, REHAB proposed lowering tax to Tk 5000 per square feet from Tk 6500.

For Dhanmondi, Lalmatia, Uttara, DOES, Karwan Bazar, Khulshi, Agrabad, Nasirabad residential area, proposed tax rate is Tk 800 from existing Tk 1500 and for non-residential area Tk 3000 from Tk 5000.  The REHAB proposed to cut tax rate to Tk 1000 from Tk 1600 in other residential area.

The REHAB vice president urged the government to introduce secondary market for the real estate sector to help expedite growth of the industry.

He also called upon the NBR to halve the import duty of reconditioned capital machinery for the sector to 1.0 per cent to keep prices of flat affordable.

The association leader proposed exemption of VAT and tax at source for developers. Currently, developers are collecting VAT from suppliers and deposit it to the public exchequer.

He alleged that realtors had to face unusual hassle and harassment by the taxmen for the system.

REHAB sought tax rebate on Bangladesh Leadership in Energy and Environment Design (LEED) certified buildings considering it energy efficient and environment friendly. REHAB members also sought reduction of gain tax, stamp duty, registration fee and VAT on registration of plot and flat.

Responding to the proposals, the NBR chairman said the board will study the impact of the opportunity of undisclosed money that has been offered for the consumers’ interest before taking further decision for the upcoming fiscal year.

He said the government is being deprived of its revenue due to under valuation on land and flat registration.

At the meeting, other related associations including Land Developers, Auto Re-Rolling and Steel Mills, Steel Building Manufacturers, Cement Manufacturers placed their respective proposals seeking tax benefit on different areas.

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Source: Financial Express

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