Government's Removal of Indexation on Property Gains Sparks Controversy

Raghav Chadha, AAP Rajya Sabha member, criticized the government's decision to remove indexation benefits on the sale of old property, warning it will lead to an influx of black money in real estate. The Budget proposal aims to rationalize long-term capital gains tax but removes indexation benefits, causing higher tax outgo for individuals selling old properties.

In a contentious discussion surrounding the Union Budget 2024-25, AAP Rajya Sabha member Raghav Chadha voiced strong criticism against the government's decision to eliminate indexation benefits on the sale of old property. Chadha claimed this move would lead to an increase in black money circulation in the real estate sector and dissuade investments, making it harder for people to acquire their 'dream homes.'

Chadha urged the government to reconsider the proposal, highlighting that investors are typically incentivized worldwide, not penalized. He emphasized that the removal of indexation benefits equates to penalizing investors, leading to significant tax burdens on individuals selling old properties.

The Budget proposes reducing long-term capital gains tax on immovable properties to 12.5% from 20%, while eliminating indexation benefits to adjust for inflation. The move has sparked widespread debate, with various leaders, including those from BJD, RJD, and BJP, expressing concerns over uneven allocation and perceived biases in the Budget, particularly affecting non-BJP ruled states.