In what could be termed a major relief for developers and home buyers, the state government on Wednesday slashed infrastructure andbasic amenities charges by 50 to 75 per cent across various categories of buildings. The revised rates will come into effect from September 9, 2009. However, all projects which have been given approval, or for which demand notes have been raised by the regulatory agencies till Tuesday, will not stand to benefit. These projects will have to pay the amenities charges as per the earlier rates.
The biggest beneficiaries of the government's latest decision are people proposing to buy apartments in multi-storeyed buildings in Chennai and Chengalpet region, for whom, the amenities charge has been brought down from Rs 1,000 per sq metre to Rs 250 per sq metre. It works out to a reduction of roughly Rs 75 per sq ft. The revised rates will have to be paid upfront as a one-time payment for obtaining plan approval for buildings.
A government order issued in this regard on Wednesday pointed out that the government had taken into consideration the slump in the construction industry, dip in real estate sales and high rates of interest for housing loans while taking such a decision.
The revised infrastructure charges for various categories of buildings are as follows: for multi-storeyed buildings which are commercial, IT, industrial or institutional in nature or that have a combination of such activities, the levy is Rs 500 per sq metre in Chennai and Chengalpet region. In Coimbatore and Tirupur region, the amenities charge for multi-storeyed buildings is Rs 375 per sq metre and in other regions it is Rs 250 per sq metre.
For multi-storeyed residential buildings across the state, a uniform infrastructure charge of Rs 250 per sq metre is applicable. For non-multi-storeyed commercial, IT, group development or special buildings (either ground-plus-three floors or stilt-plus-four floors) amenities charge is Rs 250 per sq metre in Chennai and Chengelpet region, Rs 190 per sq metre in Coimbatore and Tirupur and Rs 125 per sq metre in other regions.
For institutional buildings which are not multi-storeyed, the levy is Rs 100 per sq metre in Chennai and Chengalpet region, Rs 75 per sq metre in Coimbatore and Tirupur and Rs 50 per sq metre in other areas.
For non-multi-storeyed industrial buildings the amenities charge is Rs 150 per sq metre in Chennai and Chengalpet, Rs 112.5 per sq metre in Coimbatore and Tirupur and Rs 75 per sq metre in other areas.
Confederation of Real Estate Developers' Association of India Tamil Nadu chapter president Prakash Challa, while welcoming the move, said, "We will directly pass on the benefit to the customers. We thank the government for heeding to our request. But we are disappointed that the government has not given retrospective effect to the GO. It will lead to unnecessary litigation because in our state a planning process takes two years. Buildings which were planned three years ago, when no such infrastructure charge was there, had to pay the levy because by the time their approvals came, the government had introduced the amenities charge. Hence, the benefit being given to new buildings should be extended to all projects which were cleared since April 8, 2008 (when the previous GO was issued).