Islamabad: The government has finalized a set of proposals aimed at reviving Pakistan’s real estate and construction sectors, designed to encourage investment and generate employment opportunities. These recommendations, developed by a task force, have been submitted to the Federal Board of Revenue (FBR) for review. The measures align with the Prime Minister’s vision to boost the economy through a stronger property market.
Here’s a clear breakdown of the key recommendations:
Non-Filers Allowed to Buy Property Worth Up to Rs10 Million
In a significant change, non-filers—individuals who don’t file tax returns—will now be allowed to purchase property up to Rs10 million. This measure aims to make the real estate market more accessible to a wider group of potential buyers, including those previously excluded due to tax filing requirements.
To make real estate transactions more affordable, several tax cuts are proposed:
Capital gains tax on property sales would be reduced from 3% to 1.5% for certain transactions, and from 4% to 2% for others.
The tax on property purchases would drop from 3% to 0.5%.
These reductions will lower the overall tax burden on property deals, which currently ranges from 11% to 14%.
Lowering Overall Tax Burden
The government is proposing to lower the total tax burden on property transactions to 4% to 4.5%, a substantial reduction from the current rates. This is expected to make buying and selling property more attractive and less costly.
Overseas Pakistanis Given Easier Access to Property Investments
The proposal includes measures to make it easier for overseas Pakistanis to invest in the real estate market. NADRA will provide an online registration facility, allowing overseas investors to register and purchase property more easily from abroad.
Filers Allowed to Declare Property Worth Up to Rs50 Million
For tax filers, the new recommendations propose allowing them to declare property valued up to Rs50 million in their wealth statements, which will help ensure greater transparency in property transactions.
Regulation of Land Use to Tackle Illegal Housing Societies
The Punjab government has also proposed the establishment of a Special Planning Authority to regulate land use and curb the proliferation of illegal housing societies across the province. This will help ensure that property developments are properly planned and comply with legal regulations.
These reforms aim to make the real estate market more attractive to both local and foreign investors, ultimately driving growth in the sector. The government is hopeful that these recommendations will create a favorable environment for investment, stimulate the economy, and provide more job opportunities as the real estate and construction sectors recover.
Samra Zulfiqar, a real estate analyst at Zameen.com, is passionate about finding projects that offer buyers the best returns. Her keen insights spotlight the market’s most promising opportunities.
