ISLAMABAD – Federal Board of Revenue unveils simplified 7 points fixed taxscheme for real state sector in Pakistan.
The government has finalized a simplified fixed tax scheme for developersand builders in the real estate sector.
It will be offering a 90 percent reduction in taxes for low-cost housingschemes, particularly the Naya Pakistan Housing Authority (NPHA). Accordingto the sources, the FBR is giving final touches to the proposed scheme andwill announce it in a few days.
A central plan of action will be introduced for the beneficiaries and itwill be linked with the FBR through an automated system.
The broad contours of the scheme, according to report, include:
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1. National (central) jurisdiction of developers and builders. 2. Simplified return form. 3. Income computation on ‘project-by-project’ basis. 4. Dispute resolution committee. 5. No requirement for developers/builders to operate as a withholding agent. 6. Tax rate of Rs. 210 per square feet for commercial builders in Karachi, Lahore, Islamabad, Hyderabad, Sukkur, Multan, Faisalabad, Rawalpindi, Gujranwala, Sahiwal, Peshawar, Mardan, Abbottabad, Quetta, and other urban areas not specified. 7. The tax rates shall be reduced by 90 percent for low-cost housing schemes; (viii) tax rate of Rs. 210 per square feet for commercial developers (commercial plots) and requirement of the independent certificate from NESPAK.
According to the draft of the Builders and Developers Special ProceduresRules 2019 issued by the FBR, the rules shall apply to builders anddevelopers, who may opt to pay income tax and furnish returns under theserules.
The rules will apply to all regions in Pakistan and will be applicable atonce. The rules will be applied to all builders and developers, being anindividual, an association of persons or a resident company.
