Individuals will be required to register with FBR to benefit from the fixed tax scheme
To start off, the FBR real estate fixed tax scheme will provide concession to those planning to invest in low-cost housing projects, such as Naya Pakistan Housing Scheme. The tax rates for such builders and developers will reportedly be reduced by 90 percent.
Introduced by Prime Minister Imran Khan, NPHP is an ambitious scheme that aims to construct 5 million houses for lower-income Pakistanis in the span of five years. If you’re looking for more information on the project, don’t forget to check out the latest updates on the Naya Pakistan Housing Program, which has already taken off in different cities across the country.
Secondly, property developers and constructors will have to pay PKR 210 per square foot tax for the construction of commercial buildings in urban areas, including Lahore, Islamabad, Karachi, Hyderabad, Rawalpindi, Quetta, Peshawar, Multan, Sukkur, Faisalabad, Gujranwala, Sahiwal, Abbottabad and Mardan among other cities. Meanwhile, the rates for the construction of residential buildings will vary with each city.
Another way the fixed tax scheme for real estate will benefit the developers is by the creation of a dispute resolution committee. Moreover, there will be a national jurisdiction of builders and developers falling under the new scheme, as per the report.
The FBR fixed tax scheme for real estate will also make it mandatory for all contractors and builders to obtain a certificate from the National Engineering Services Pakistan, more commonly referred to as NESPAK. The certificate, accompanied by the covered area and layout plan of the project, will be presented to the FBR for approval. However, projects covering an area under 5,000 square feet will reportedly be exempt from fulfilling such requirements.