Rising debt & sops may prompt govt to increase RR rate this April

Pune: Buying a flat could become costlier in the next financial year, senior revenue department officials said on Tuesday, hinting at a likely increase in Ready Reckoner (RR) rates in April in view of the widening revenue deficit and increasing debt due to welfare schemes like Ladki Bahin Yojana.The officials said district-wise consultations with stakeholders were under way and the final decision would hinge on the funds needed for infrastructure projects, welfare schemes and recently announced sops. "Given the growing revenue deficit and the sharp increase in supplementary demands, a revision in RR rates seems to be the way forward. Having said that, no final decision has been made yet," a senior revenue department official told TOI.
The stamps and registration department is the highest revenue generator for the state.After a pause over three financial years, govt had increased RR rates by an average of 3.9% across the state last year, following a average 5% hike in 2022-23. For the current fiscal ending March 2026, the property registration department has set a revenue target of Rs 63,500 crore, revised upward from Rs 60,000 crore, and has already achieved nearly 75% of it.Developers, however, opposed any hike in RR rates, arguing that strong revenue collections made a revision unnecessary. Credai members said property registrations remained robust and the real estate market was buoyant, a trend likely to continue. "Earlier, govt's decision to keep RR rates unchanged for three financial years (after requests from citizens and developers) helped maintain stability," a developer said.Credai national governing council member Shantilal Kataria said the state managed to earn adequate revenue without increasing RR rates in the past. "Like other sops, govt should ensure the middle class is not burdened. RR rates should remain unchanged for the next financial year since they were already increased this financial year. Market buoyancy must be considered before making any abrupt decision. We had also urged govt earlier not to revise rates again," he told TOI.Another Credai office bearer said any further increase in RR rates would negatively impact the real estate sector, noting that the department achieved around 140% of its target in 2022-23, 100% in 2023-24 and 105% in 2024-25. Developer associations argued this performance was reason enough to maintain current RR rates, even as govt assessed the need for additional revenue to finance welfare commitments.RR rates dictate stamp duty and registration charges and vary by area, infrastructure, amenities and property type. Meera G, who plans to purchase property in next financial year, said an RR hike could disrupt her plans. "Builders may use it as a reason to raise prices since RR acts as the base rate. Properties currently priced below RR will attract higher stamp duty and taxes if the rates go up," she said, adding, "Any increase will raise overall costs, reduce purchasing capacity and affect the market." GRAPHICMAHA FISCAL PRESSURERevenue DeficitMarch 2025 budget projection: Rs 45,890 croreIncreased to over Rs 1 lakh crore after supplementary demands in June 2025: Rs 57,509.71 croreFurther increased to close to Rs 2 lakh crore after another request last Dec: Rs 75,286.37 croreTotal debt: Expected to rise to Rs 9.32 lakh crore