Farmers of Amravati, the new capital of Andhra Pradesh, were upbeat by finance minister Arun Jaitley’s announcement exempting their income from the sale of their lands under the unique land pooling scheme from capital gains tax. This is the biggest relief for the about 23,500 farmers, which Chief Minister N Chandrababu Naidu and local MP G Jayadev had promised while taking their lands. The FM made the announcement in the budget 2017-18 presented to Parliament on Wednesday. Income tax officials earlier clarified that the farmers who had parted with their lands for the capital’s construction would attract capital gains tax on the money they earn when they sell the developed land given back by the government.
On October 26 last year, Jaitley made a commitment to the worried farmers in Amravati to take a positive stand on the issue.
In the absence of exemption, farmers would attract long-term capital gains tax of 20 percent on the difference amount between indexed cost of land acquisition and improvement and the amount the plot is sold for now.
The Chandrababu Naidu government acquired a little more than 33,000 acres from 23,500 odd farmers under the pooling scheme.
As per the scheme, farmers would get back 1,200 square yards of residential and 200 square yards of commercial land for each acre they had parted with, upon development. The remaining land will be retained by the government for building the capital.
“We are now happy. This is what we have been lobbying for for the last two years. Thanks to the Central government”, Tulluru Srinivasa Rao, a farmer who gave five acres for the capital, told media Mirror over phone after listening to Jaitley’s budget speech.
Credits Bangalore Mirror