Here Are the Expected Tax Cuts and Other Incentives in the Upcoming Housing Sector Proposal

The federal government has finalized a set of key proposals to revive the housing sector. Prime Minister’s Task Force for Development of the Housing Sector has finalized a set of key proposals with a focus on increasing employment, easing property transactions, and encouraging more investments in the sector. Key proposals include allowing non-filers to purchase properties worth up to Rs. 10 million. The government is considering reducing taxes related to property sales and purchases. Specifically, the tax under section 236C for selling property may be reduced from 3 percent to 1.5 percent, with more cuts likely for some cases from 4 percent to 2 percent. Here is how the overall impact of transaction taxes will likely be reduced: Similarly, the tax under section 236K for purchasing property could be slashed from 3 percent to 0.5 percent. Currently, property transactions are subject to a cumulative tax rate of 11-14 percent, but the new proposals will help reduce it. For overseas Pakistanis, a proposal is in place to facilitate property purchases by allowing them to register online with the National Database and Registration Authority (NADRA). The task force has also recommended to include property worth up to Rs. 50 million in the wealth statement of filers.