Commercial and co-working segment of real estate sector have appreciated the government’s focus on job creation, skilling and employment-linked incentives in its recently-announced Union Budget 2024-25.
Welcoming the overall budget announced by Finance Minister Nirmala Sitharaman on Tuesday (23), Adity Verma, founder & CEO of The Office Pass (TOP), said, “The budget is extremely positive for the Indian Coworking Industry.
“Over 50% of Coworking spaces are used by SMEs in India. The budget has extended the allocation under the ECLGS scheme for MSMEs from 5.25 to 6 Lakh Crores in FY’25. This will bring in higher liquidity to the segment and there is likely to be a direct benefit to the Coworking Industry due to greater formalisation of the MSME industry.
Samir Jasuja, Founder and CEO of PropEquity, pointed out that while the Budget sidesteps the long-standing demands of the real estate sector, the focus on job creation, skilling and employment-linked incentives, boost to infrastructure, urban redevelopment and relaxation in income tax slabs are the big reforms that will indirectly provide a fillip to the real estate sector.
“The call to State Governments to reduce Stamp Duty and initiate land related reforms that includes urban planning, usage, building bylaws, and GIS mapping of land records are steps in the right direction that will not just help the sector but also be a strong growth propeller for the Indian economy.”
Appreciating the Sitharaman’s focus on infrastructure growth, Manas Mehrotra, Founder at 315Work Avenue, stated that the investment in infrastructure is deemed vital as its cascading impact encompasses numerous sectors as well as job creations.
“The announcement on abolition of angel tax for all classes of investors is a great boost for the start-up sector and will encourage the coworking space as this will now invite large investment without taxation concern. The other announcement on ease of business conditions is also welcome as this would make the environment for companies less regulatory.
“The credit guarantee scheme and technology support to MSME’s is also positive as this would improve the sector which has been ailing from low credit access and poor technology. Taking into consideration the popularity of hybrid working, the budget could have met a few expectations of coworking sector – particularly lower GST rate for small-scale coworking clients and the establishment of the single-window clearance system.
“An important requirement for the coworking industry has also been Lower/Concessional rate of TDS which will improve the working capital.
“Going forward, we hope that the government looks at addressing regulatory concerns and encouraging more coworking firms to open-up through a series of both financial and non-financial incentives and ensure faster economic growth. As we move forward, the demand for coworking spaces is only set to witness greater traction from companies across segments.”