This refers to the report “Ministry for inclusion of affordable housing in infra list” (December 7). It’s an open secret that builders and developers pay heavy bribes to various government agencies to procure multiple permissions and licences. That automatically escalates the housing cost for buyers. Moreover, builders take 20 to 30 per cent of the cost in cash. Since buyers do not get any loan entitlement on the cash component, this is a problem for home-loan seekers. It is in this context that the government wants a rate cut so that banks can reduce the interest rate on loans but on the other hand, the government has increased service and value-added taxes. Similarly, state governments have increased stamp duty and registration charges on sale agreement.
Now, according to the Reserve Bank of India mandate, in calculating the loan limit, banks do not consider expenses such as stamp duty and registration charges. It is, hence, advisable that the government should reduce taxes, stamp duty, registration charges, and take effective steps to stop cash collection by builders.
Jagdip H Vaishnav Mumbai
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