Your MHADA dreams to fall flat

Mhada's affordable homes are no longer going to remain so. From the next lottery, the flats will you 15 per cent more.

The authority has decided to charge service and sales tax will add up to 15 per cent of the cost of the home. So, for every lakh, you will have to pay Rs 15,000 extra for your flat and for every Rs 10 lakh you will shell out Rs 1.5 lakh.

Pic for representational purposes only

MHADA, that gives affordable housing to Mumbaiites, is being forced to hike the rates, because the finance department has sent a circular stating that, for every home, there will be more than 12 per cent service tax and more than 3 per cent sales tax. This will raise the cost of a flat by at least 15 per cent.

State housing minister Sachin Ahir confirmed the changes. "Earlier there were exemptions for paying taxes. But now, it is mandatory. If taxes are mandatory it will be passed on to the buyer and the flat costs will go up," he said.

However, he also added that his department is trying to find ways to help the common man. "Being a state functioning department, we under the housing department will seek exemptions from the central finance ministry on the same," said Ahir.

A senior MHADA official, on condition of anonymity, commented, "We are forced to hike the prices, as the direction is from the top finance authority and there is no way it can be compromised."u00a0