It is like a dream for any person to have a house. Every person wants that the roof in which he slept is his own. But a large part of people in our country is struggling to buy their home and depend on home loans to fulfill this dream. Home loan has become a major need for people due to the ever increasing prices of homes and flats. But home loan can give a relief to people who buy more and more houses than tax exemption.
In Budget 2025, this time everyone’s eyes are on the government as to how they will remove the concerns of the house buyers, especially those who are facing the rising property prices and the increasing burden of home loans. A great hope from this year’s budget is that under Section 24 (B) of the Income Tax Act, the exemption limit on home loan can be increased. Currently, the exemption limit on home loan interest under 24 (b) is 2 lakh.
The current exemption limit of Rs 2 lakh on home loan interest has been applicable for many years, which was introduced when the price of property and loan amount was very low. However, due to the continuous increase in real estate prices for the last few years, it is insufficient for today’s home buyers.
Real estate prices have increased rapidly in most cities in the last few years. If we talk about the metro city, then the average price of houses there has doubled or tripled in the last decade. Due to this, the amount of home loan and interest payment has also increased.
Apart from this, inflation has increased the financial burden on home buyers, which has reduced their ability to buy. If tax exemption is given, then people will get relief and due to this more and more people can buy houses. Also, cheap housing buyers will get encouragement due to increase in discounts.
Experts and people associated with the industry have earlier emphasized the need to increase the exemption limit, in which it has been suggested to increase the limit from Rs 3 lakh to Rs 5 lakh. If the government takes such a step, it will also benefit the real estate market and will make it easier to buy a house for the middle class.
Another big issue is that there is a shortage of tax benefits related to home loans in the new tax regime. While the new regime simplifies tax slab and eliminates discounts. This is the economic loss to taxpayers who depend on the cuttings like home loan interest and repayment on the principal amount.
If it is included in the new tax regime, it will make it easier for taxpayers to take home loans and invest in real estate. This will also promote the housing sector. Along with excluding home loan cuts, middle -income taxpayers avoid entering new systems due to inequality in many things between old and new tax regime.
Apart from this, if investment in this sector increases, then it will also benefit on collaborative industry like cement, steel and construction, which are important for economic development. This effect can be increased by giving rebate in home loan in both taxes.
Can there be any changes related to home loan in this budget? On this, tax expert Gauri Chadha says, “The government’s goal is to have their own home, so tax benefits should be increased on the interest of home loan and the report of the principal amount, but these benefits are only in the old tax regime and feel It is that the government will soon focus on the new regime by eliminating the old regime. It is a little difficult to bring such cuts in the new regime, because if this happens, there will be no difference between the two tax regime and the new tax regime will also become complicated as the old. ”
She further says, “If we talk about the limit, then if there was only an old regime, then I think this limit should have been doubled and the report of the principal amount should be clubbed separately or with section 24. Was, because 80C already has many cuts and its limit is only 1.5 lakhs. However, I do not think there will be changes in the old regime and it would be useless to put such a cut in the new regime. The best way would be to increase the basic examping limit so that everyone can get the benefit of it, save money, invest and then buy their homes. ”
Gauri, expressing her opinion on the process of making home loans easier, says, “There is a need to take several steps to make real estate accessible to all, not just the benefits of home loan. This mainly includes low interest rates and more relief in sections 54 and 54F. There should be deductions for the repayment of interest and principal amount, but there is not much hope on the current situation.
She says, “As far as it is concerned, I would not say that it should not be complicated because it will not be complicated. The aim of the government should be to simplify tax, not complex. Taxpayers are still struggling to understand both the regimens, which have many slabs, so it should be maintained with just a high basic examping limit.