Karachi, October 9, 2023 – The Association of Builders and Developers (ABAD) of Pakistan has called upon the government to abolish Section 7E from the statute.
ABAD Chairman Asif Sumsum strongly criticized the controversial tax policies of the Federal Board of Revenue (FBR) and demanded that the Caretaker Government abolish Section 7E of the Income Tax Ordinance 2001.
Chairman ABAD expressed concern over the implementation of Section 7E in two provinces for both filers and non-filers, while it continues to be applicable in two other provinces and other parts of the country. He emphasized that the controversial implementation of Section 7E has led to disputes and is hampering the growth of the construction industry and the national economy.
Asif Sumsum highlighted that the construction industry plays a vital role in the economy and is a major contributor to tax revenue. Karachi and other parts of Sindh are at the center of significant construction activities, with Karachi alone contributing 68 percent of the total revenue for the country. Therefore, any negative impact on the construction industry in Karachi and Sindh would result in a substantial loss of tax collection for the government.
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He noted that the FBR insists on continuing with Section 7E without considering the real-world consequences. While the FBR aims to collect an additional Rs. 1000 through this controversial section, it risks losing Rs. 5000 because many builders and developers have halted their projects, and new investors are hesitant to invest further.
Asif Sumsum called on the Caretaker Government to immediately suspend the implementation of Section 7E of the Income Tax Ordinance 2001 to protect the construction industry and the livelihoods of thousands of skilled, semi-skilled, and unskilled workers. He also urged the government to consult with all stakeholders before imposing any tax collection laws to avoid unintended negative consequences. If the government does not take action to halt the implementation of Section 7E, ABAD warned that it may organize a joint press conference with other business communities to address the issue and protect the national economy from potential losses.
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