New Delhi, Jan 6 (PTI) National Real Estate Development Council on Monday pressed for a hike in deduction on housing loan interest payment from Rs 2 lakh to Rs 5 lakh and accord infrastructure status to the housing sector in the forthcoming Budget.

Talking to reporters after attending the customary pre-budget meeting with Finance Minister Nirmala Sitharaman, National Real Estate Development Council (NAREDCO) Chairman Niranjan Hiranandani said that efforts are needed to be made to increase the flow of funds to the affordable housing sector.

Hosts of suggestions were made to push energy, urban development and road infrastructure growth.

"In housing loans, the permissible deduction (under the Income-Tax Act) is Rs 2 lakh, which is very low. It needs to be increased to at least Rs 5 lakh," Hiranandani said.

Apart from Hiranandani, GMR Group Business Chairman BVN Rao, Afcons Infrastructure Limited Managing Director S Paramassivan, and ReNew Group Chairman Sumant Sinha attended the meeting, among others.

"There was also a talk relating to...housing to be considered as infrastructure status, how the funding could be made available so that more affordable housing and those things can also come up," he said.

Hiranandani pointed out that in his career of more than 40 years, this is the first year when affordable housing growth is negative.

"So, I think the focus on the Pradhan Mantri Awas Yojana scheme for the purposes of incentivising affordable housing was a major thing," he said.

While noting that everybody does not have house ownership, Hiranandani said that in the last budget, the finance minister had given an incentive for the purposes of industrial workers' rental housing.

"Up till now, we are only talking about ownership housing, but a focus needs also to be done on rental housing," he said.

Hiranandani said that issues related to capital gains tax on the purchase of houses were also discussed.

"In case of capital gains, if I sell a house and buy two houses, that is capital gains tax exempt. But then, if I have three children and I want to buy three houses, there is no exemption for capital gain," he said.

Hiranandani said he suggested the finance minister to address loopholes related to capital gains tax while buying a new house.

Larsen & Toubro (L&T) head indirect taxes Gurinder Pal Singh said Indian infrastructure companies are now becoming multi-national companies.

"L&T revenues are largely coming from offshore projects. We have sought more proactive support from the government in resolution of issues when we work in offshore territories," Singh said. PTI BKS BKS BAL BAL

Housing loan interest deduction increase urged to boost affordable housing incentives and access to infrastructure financing. Proposals seek to raise the allowable deduction for housing loan interest to expand tax incentives and improve fund flow into affordable housing, and to accord infrastructure status to housing to access infrastructure financing. Additional recommendations focus on promoting rental housing, remedying capital gains tax anomalies when reinvesting sale proceeds into multiple residential properties, and securing greater government support for infrastructure companies working offshore.