Quick Summary
Industry insiders and experts are urging the Union Budget 2025 to introduce tax incentives and simplify the tax structure to enhance the appeal of Real Estate Investment Trusts (REITs) as a viable investment option. Suggestions include sops for green building developments and measures to drive retail and institutional participation in REITs, currently a niche asset class in India. REITs in India: Current Landscape India presently has four listed REITs, three of which focus on office assets bac
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FAQ :
Experts are requesting tax incentives and a simplified tax structure to boost the appeal of REITs as an investment option, alongside specific measures for green building developments.
Retail investor participation remains low due to modest returns, with India's first listed REIT, Embassy Office Parks REIT, showing an 18% share price rise since 2019, lagging behind the Nifty 50 index.
Proposals include exempting dividends from double taxation, offering capital gains exemptions on asset transfers and security swaps, and aligning withholding tax rates for foreign portfolio investors.
Experts suggest introducing tax breaks and incentives specifically for sustainably built office spaces, which would align with corporate ESG mandates.
India currently has four listed REITs, primarily focusing on office assets. Despite SEBI's efforts, retail investor interest is limited, although institutional investors find their structure appealing.
Experts believe that tax reforms and green building incentives could attract more investors, stimulate foreign investment, enhance market liquidity, and solidify REITs as a preferred investment avenue.
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