Islamabad, Pakistan, June 3, 2024 – Sardar Tahir Mehmood, President of the FORP and Islamabad Estate Agents Association, has expressed displeasure against the government’s proposed taxation measures on the real estate sector. In a firm statement, he pledged to record nationwide grievances to resist these policies, which he believes will severely impact the industry and the economy.
The government is currently considering several proposals aimed at increasing tax revenues from the real estate sector. These include raising tax rates for both filers and non-filers involved in property transactions, imposing capital gains tax regardless of the holding period, revising the definition of personal immovable property, and increasing property valuation statements across various cities.
Specific measures under consideration include:
- A 3% tax on properties worth up to 50 million, 4% on properties up to 70 million, and 7%on properties worth 100 million, levied from sellers.
- Including capital gains as taxable income under “income from property” for individuals and “income from business” for corporations.
- Abolishing the capital gains tax exemption for industrial units in special export zones.
These proposals align with the IMF’s progressive taxation requirements, mandating the Federal Board of Revenue (FBR) to implement these changes.
Sardar Tahir Mehmood, responding to these developments, stated, “The imposition of such taxes will lead to double taxation and drive away investments. We have already witnessed an exodus of $25 billion to real estate markets in other countries. These new measures will further burden our industry and economy.”
He urged the FBR to reconsider and avoid implementing these detrimental policies. He proposed that instead of imposing additional taxes, the FBR should:
- Notify agreed valuation tables for different cities to help increase tax collection without overburdening the sector.
- Abolish Section 7E to eliminate unnecessary tax burdens.
- Reduce transaction costs to 2% under Sections 236C and 236K for sellers and purchasers.
- Maintain the current holding period exemptions for capital gains tax.
“We, as a community, are prepared to highlight our disapprovals and show our grievances and resentments across the country if these proposals are not withdrawn,” declared Sardar Tahir Mehmood. “The real estate sector is a cornerstone of our economy, and these measures threaten its stability and growth. We call on the government to engage in meaningful dialogue with stakeholders to develop fair and sustainable tax policies.”
The Islamabad Estate Agents Association and FORP stands united in its commitment to protecting the interests of real estate professionals and ensuring the sector’s continued contribution to Pakistan’s economic development.
Media Information:
Name: Amir Imtiaz
Organization: Win Win Marketing & Developers
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