Surcharge cap on consortiums to help realty, infra joint devt pacts

The government's proposal to cap the surcharge applicable to 'associations of persons' (AOP) related to consortiums or joint development agreements (JDA) at 15% is expected to provide tax relief to such real estate and infrastructure projects. The rationalisation of the surcharge on AOP is expected can help the real estate sector, which follows the AOP model with land aggregators and landowners who work as joint venture partners. Higher tax implications on JDA transactions have been proving to be a deterrent for both parties to enter into such transactions. Higher tax incidence also had an effect on the final cost for homebuyers.