The government of Goa is planning to implement new tax rules for prospective buyers of apartments in housing societies. Until now, buyers who purchased second-hand flats from the owner of a flat had to complete transfer formalities such as transferring the share certificate, paying the membership fee, stamp duty on the purchase value at a rate of 6 to 8 percent, and also a premium for the transfer at a rate of 1 to 2 percent of the flat’s purchase value.
Under the new tax regime for housing societies, the burden on the common man to purchase even second-hand properties will become a costly affair. Since the government intends to collect tax on transfers or sales to third parties, except for family members, additional charges will need to be borne, and the total cost will rise to nearly 15 percent from the current 6-8 percent. The new notification, which is likely to be introduced, will impose a 4 percent tax on the market value to be paid to the government and an additional 4 percent to the housing society by the purchaser.
The cost of new flats in Goa is already sky-rocketing, forcing common people to seek loans from banks and other financial institutions to afford them. With this notification, even second-hand flats will become more expensive for buyers. There is no standard rate applicable for flats or plots in Goa; builders determine the rates based on the location of their constructions, and CREDAI has no control over their charges. The overall impact will be on the common man, who will have to pay more to purchase second-hand flats in Goa. The government should consider granting some exemptions, at least to Goans who intend to buy property, and levy these charges on those from other states purchasing property in Goa.
