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ISLAMABAD: The federal government is considering removing the Federal Excise Duty (FED) on the transfer of plots and commercial properties due to low revenue generation in the first half of the 2024-25 fiscal year.
The Federal Board of Revenue (FBR) plans to suggest removing the Federal Excise Duty (FED) on the sale and transfer of business properties, as well as on the first sale of open plots or residential units.
The modification will be included in the next federal budget once it is finalized. To encourage more real estate transactions, the government is also thinking about cutting transaction taxes.
The housing development task group has suggested getting rid of Section 7E of the Income Tax Ordinance, eliminating capital value tax (CVT) in Islamabad, and reducing property transaction taxes. Real estate investments up to Rs50 million should not be subject to wealth reconciliation criteria, and there should be uniform taxes through the National Duty Council. Additionally, stamp duty rates should be standardized between provinces and the federal capital.
This week, after being delayed twice by the prime minister’s schedule, a meeting is scheduled to consider these recommendations.
The real estate industry would benefit from these suggestions, according to experts, since they would lower construction and transfer costs.
Additionally, the real estate industry is hoping for tax cuts in the next budget, which might lead to significant changes that attract more investors and get the market moving again.
