Islamabad, August 7, 2023 – In a meeting with representatives from the real estate sector, Malik Amjed Zubair Tiwana, the Chairman of the Federal Board of Revenue (FBR), firmly declined to grant any tax exemption to the realtors.
The decision comes in light of the Stand-By Arrangement (SBA) with the International Monetary Fund (IMF), which restricts the possibility of introducing new tax exemptions, concessions, or preferential treatments at this time.
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During the meeting, Chairman FBR assured the realtors that their concerns would be addressed, and his team would work towards facilitating the removal of any difficulties arising from the implementation of tax laws. He stressed the importance of proper coordination and consultation with the realtors to find appropriate solutions to their challenges.
The meeting was convened as per the directives of the Minister for Finance and Revenue, issued during the 90th meeting of the National Assembly Standing Committee on Finance and Revenue on August 4, 2023. The Chairman FBR, Malik Amjed Zubair Tiwana, led the meeting, which included a delegation of Realtors led by Sardar Tahir Mehmood, President of the Federation of Realtors Pakistan, and a team of FBR officers.
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The Realtors’ representatives highlighted the urgent need to rationalize the taxation of immovable property, considering the country’s current economic challenges. They emphasized that the real estate sector has been a significant source of both domestic and foreign investment in the past. However, the prevailing economic conditions have led investors to shy away from putting their money into the real estate sector. They argued that the taxation measures introduced through the Finance Acts of 2022 and 2023 have created a discouraging environment for investment in the real estate industry.
One of the main proposals put forth by the Realtors’ delegation was the abolition of the tax on deemed income from immovable property. They also requested that the valuation table of properties should either remain unchanged for the time being or, if any revision is necessary, it should be done at a fair level after thorough consultations with all stakeholders.
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However, the Chairman FBR cited the constraints imposed by the IMF’s SBA as the reason for not being able to grant the tax exemptions proposed by the realtors. The IMF Stand-By Arrangement is a financial assistance program that Pakistan entered into with the IMF to address its economic challenges and achieve stability.
While the real estate sector may face disappointment due to the rejection of their proposals for tax exemptions, Chairman FBR reiterated the government’s commitment to finding viable solutions to the sector’s concerns. He assured the realtors that the FBR would continue to work with them to facilitate a conducive investment environment in the real estate industry while adhering to the constraints imposed by the IMF agreement.
