The Budget had proposed tax relief for buyers and sellers by allowing property to be valued at up to 5% below circle rates for calculation of stamp duty and capital gains tax.
Circle rates, also known as ready reckoner or guideline value, have been revised upwards by most local governments over the last 15 years.
These rates were introduced to prevent tax evasion by declaring a lower sale price of the property on paper. Stamp duty should be collected on higher of either on the sale proceeds or the circle rate value.
Ramesh Nair, CEO and Country Head, JLL India, said the proposal would reduce difficulties for sellers. “With this, the government has recognised that there could be price variations within a zone or locality that has the same circle rate,” he said.