PM Shehbaz Delays New Real Estate Tax Package

Prime Minister Shehbaz Sharif has deferred his decision on the tax incentive package for the real estate sector as key issues remain unresolved. The Federal Board of Revenue (FBR) has opposed a proposal to grant first-time home, shop, or office buyers an amnesty of up to Rs. 50 million, The regulator has warned that the International Monetary Fund (IMF) has banned such exemptions, reported Express Tribune. FBR Chairman Rashid Langrial rejected it. He argued that it would amount to a tax amnesty that the IMF would not allow. At a meeting of the housing sector task force, officials discussed reducing property transaction taxes and abolishing the 3 percent federal excise duty (FED) on real estate. The FBR chairman supported removing the duty. However, some members of the task force raised concerns that tax cuts could encourage speculative investments in real estate. The government is also considering interest rate subsidies to facilitate home loans for lower and middle-income groups. The real estate sector remains largely unregulated, with agricultural land frequently converted into housing societies, many of which lack regulatory approval. The market also faces an oversupply of plots and concerns over fraudulent sales of apartments and land.