Govt to Fine Real Estate Agents and Owners Up to Rs. 10 Lac for Tax Evasion

The government has finalized preparations to set up the Real Estate Regulatory Authority to fine up to Rs. 1 million and give prison sentences of up to three years to curb tax evasion and illegal transactions in the real estate sector. Unregistered individuals doing business could face fines ranging from Rs. 50,000 to Rs. 500,000, while real estate agents providing false information may be penalized between Rs. 200,000 and Rs. 500,000. Moreover, wrongful property transfers could result in fines between Rs. 500,000 and Rs. 1 million, while failure to submit the required documents may lead to fines of Rs. 50,000-200,000. This comes in response to demands set forth by the International Monetary Fund (IMF) on ways to improve tax revenue. The lender has pushed for stricter regulations in the sector as part of ongoing talks for the first review of the $7 billion loan program. Policy-level talks between Pakistan and the IMF have started today. They will continue for two weeks, after which the IMF review mission will submit its recommendations to the Executive Board. The final decision on releasing the next $1.1 billion tranche, along with potential measures on electricity pricing, is expected by the end of this month or early April.