The Association of Builders and Developers of Pakistan (ABAD) has called on the government to abolish the 3% Federal Excise Duty (FED) imposed on the housing sector to stimulate its revival. The organization stressed that this move is essential for addressing the ongoing challenges in the real estate market and boosting economic growth.
As part of its proposals, ABAD has recommended the introduction of a 10-year fixed mortgage product tied to the 10-year Pakistan Investment Bond (PIB) yield. This initiative aims to make homeownership more affordable for the masses by providing long-term, stable financing options. These proposals were presented by SM Nabeel, Chairman ABAD (North), at the inaugural meeting of the federal task force established to tackle issues within the housing sector and promote sustainable development.
In an interview with Business Recorder, SM Nabeel expressed his gratitude to Prime Minister Shehbaz Sharif, Federal Finance Minister Muhammad Aurangzeb, and Federal Minister for Housing Riaz Hussain Pirzada for their commitment to revitalizing Pakistan’s housing industry. He praised the Prime Minister’s leadership and the proactive efforts of his team in strengthening the economy. Nabeel highlighted the positive reception of ABAD’s proposals by the Finance and Housing Ministers during the task force meeting.
ABAD presented a detailed proposal outlining critical challenges and potential solutions to unlock the sector’s immense potential. Among the key suggestions was a reduction of withholding tax on property transactions to 1%, coupled with a tax exemption for the first property purchase to encourage homeownership. The association also emphasized the importance of measures to curb capital flight and retain investments within the country. One such recommendation is to prioritize the construction sector within banks’ lending portfolios to stimulate economic growth.
Nabeel stressed the importance of implementing balanced policies, advocating for measures that penalize non-filers while encouraging genuine investment in the real estate market. He noted that fair and supportive policies could unlock an estimated $100 billion in investment potential, providing a significant boost to economic recovery and development.
“Pakistan’s real estate sector has tremendous potential to drive economic growth with the right support and policies,” Nabeel stated. He expressed optimism about continued collaboration between ABAD and the government to create an environment conducive to growth and investment in the housing sector.
In conclusion, the Chairman reaffirmed ABAD’s commitment to working closely with the government to ensure sustainable development in Pakistan’s housing industry. By addressing key challenges and implementing supportive measures, the sector can become a major contributor to the nation’s economic progress.
