Union finance minister recently stated that the government wants to lower the interest rate to a level that paying EMIs to banks will be cheaper than paying rent to landlords, reports Hindustan Times (HT).

"Low interest rates will make borrowings cheaper, particularly for homebuyers, and boost consumer demand that will boost economic growth," Jaitley said in an interview.

Jaitley claimed that under the first NDA government led by former Prime Minister Atal Bihari Vajpayee, home loans had become so affordable that paying equated monthly instalments (EMIs) was easier on the pocket than renting a house. "I think that’s where we need to take interest rates," he noted.

Commenting NDA government’s commitment to increasing the spending capacity of the middle-class by cutting down tax rates, the minister said, "We brought indirect taxes – GST (Goods and Services Tax) down. For housing, we have brought it down to a negligible level.”

"The future of the Indian economy is the middle class and the neo-middle class and today’s poor should eventually become a part of that," Jaitley added.

Continuing The Glide Path

In another interview with The Hindu BusinessLine (BL), Jaitley stated if the Prime Minister Narendra Modi government is voted back to power, it will continue to cut taxes rates

“I’m quite clear in my mind that on two issues: at least we had a lot of good fiscal prudence and we brought the rates down. If we are in power we will continue the same glide path,” said Jaitley while addressing a session organised by industry body CII.

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