PUNE: The Maharashtra government is likely to continue with the 1% Metro cess, an additional stamp duty levied while registering properties in metro cities.
Several citizens and realtors have requested the government to withdraw the cess to bring down the stamp duty. The state has earned over Rs3,000 crore till October from the Metro cess since it was introduced in February 2019 in Mumbai, Pune, Thane and Nagpur to fund public infrastructure projects.
Senior official from the revenue department said that as of now there is no such consideration as work is still on in these key cities. “Any decision on reduction of stamp duty and regarding ready reckoner rates will be taken at the end of March,” he said.
In March 2020, the Metro cess was discontinued owing to widespread financial distress on account of the Covid-19 pandemic. However, it was reintroduced in April last year.
Citizens and realtors have been demanding removal of this additional 1% cess, which puts an additional burden on citizens as well as realtors.
State Credai president Pramod Khairnar said common citizens use the Metro and all different types of trades and industries get the benefit of such infrastructure facilities. However, the real estate industry is always a soft target. “Already stamp duty and GST without input credit are a burden on the cost of units. A person willing to fulfil his dream of owning a home needs to shoulder this burden. We request the government to remove such cess on stamp duty,” he said.
Citizen activists said they have been requesting the state government to reduce the 1% Metro cess as almost 80-90% of Metro work in Pune city and other areas was nearing completion.
“It is a huge financial burden on prospective property purchasers,” said Shrikant Joshi, an activist.
The Metro cess is collected through stamp duty registration of documents for sale, gift and mortgage of properties. In Mumbai, the duty was raised from 5% to 6%, and in the other cities, it was raised from 6% to 7%. A 1% increase in stamp duty means an additional burden of approximately Rs 50,000 on an average property buyer.
The state registration department has been registering about 2 lakh documents monthly and the revenue has already crossed 50% of the target. Developers said property registrations and revenue collections have picked up post-pandemic.
“If there is reduction in stamp duty ahead of elections next year, it will boost the realty sector,” said a property research consultant.
“The real estate sector is slowly inching towards pre-pandemic times with registrations picking up in all sectors. The government should reconsider withdrawing the cess as cities like Mumbai, Pune and Thane see maximum registrations, and the realty sector in these cities will definitely be affected because of this,” said Mahima Prabhu, a realtor.
