The federal government has approved significant revisions to advance tax rates on property transactions while simultaneously increasing the tax burden on banks and large corporate entities under the Finance Bill 2026–27. The new measures will come into effect from July 1, marking the start of the new fiscal year.
Under the revised framework, advance tax on property transactions has been reduced. Property sellers will now pay 2.75 percent advance tax on the total value of the property, while buyers will be charged 1.25 percent based on fair market value.
Officials said the revised rates are intended to streamline property transactions and adjust tax collection mechanisms in the real estate sector while maintaining fiscal balance.
In contrast, the government has increased taxation on the corporate and banking sectors. From July 1, banking companies and the fertilizer sector will be required to pay a 10 percent tax on income exceeding Rs150 million, while other corporate entities will face an 8 percent tax on income above Rs500 million.
The revised taxation structure is part of broader fiscal reforms aimed at balancing revenue generation needs with sector-specific adjustments across the economy.
Authorities said the changes reflect ongoing efforts to widen the tax base, improve compliance, and ensure equitable contribution from high-earning sectors while providing relief in certain segments such as property transactions.
The Finance Bill 2026–27 forms part of the government’s annual budgetary framework and will guide taxation policy for the upcoming fiscal year.
