Land pool farmers seek tax benefit for 10 years

Amaravati: After a day of initial euphoria, farmers who surrendered their lands for construction of capital Amaravati under land-pooling system are examining the real benefits of the capital gains tax relief announced by the Centre in its budget.

The exemption from tax on sale proceeds of land by landowners is limited only for next two years. According to the guidelines, the landowners can get benefit only if they sell their land in the next two years’ period from the date of announcement.

However, a majority of the landowners prefer to hold their lands instead of selling them, expecting huge developments after two years. Moreover, Chief Minister N Chandrababu Naidu also repeatedly urged the landowners not to sell their lands now.

In this backdrop, they landowners are requesting the Centre and the State governments to enhance capital gains tax exemption benefit period for 10 years.

Now the land prices are an average of Rs 1 crore to Rs 2 crore per acre based on the location in the Amravati capital region. A few landowners have already sold their lands tempted by current price.

Now they are constructing new houses and invested part of the proceeds in lands in some other locations in Krishna, Guntur and West Godavari districts.

After meeting some immediate financial needs and procuring basic comforts, they now they want to preserve their lands expecting huge prices in future.

“Land prices range from Rs 1 lakh to Rs 2 lakh per square yard in various important centres in Vijayawada city at present.

Once the development takes place, including setting up of education institutions, administrative capital city and construction of roads, the lands in the capital region would get a huge demand on par with Vijayawada city and prime locations in Hyderabad,” said a Hyderabad based software engineer Kommareddy Srinivasa Rao who bought land in Inavolu village in the capital region.

The land owners may get up to Rs 10 crore for their share of 1,250 square yard plots which were allotted by the government per each acre they had given under the land pooling scheme. “If the capital gains tax sop is confined to only two years, majority of landowners may not get any benefit,” he added.

Meanwhile, landowners felicitated Guntur MP Galla Jayadev at Tulluru in Amaravati capital region on Thursday for his efforts in getting the tax benefit.

But they requested him to again put in efforts for extending the time limit for next 10 years instead of present two years. They said that the present rule forces the landowners to sell their lands in the next two years.