Asif, it says “immovable property”, doesn’t specify which type. So I guess all types are included.
Question:
When will this tax be applicable? I suppose for the financial year 2022-2023. If yes, then there is no immediate incentive for the govt to collect tax.
Secondly, 1 year will be enough for people to transfer plots to their spouse and children and/or replace it with built-up property. Thus, completely avoiding this tax. So it’s not a very smart idea !
The only benefit I see is that this will discourage open plot investment while incentivise construction and transfer of wealth to productive sectors. Well, this could be a smart idea !
But small investor will remain undeterred. So it will not completely discourage open plots. Only plot-holding will become smaller by distributing among family members.
The tax comes into force from 1 July 2022.
But on the other hand The industrial relief package is stoped ,
this just seems a desperate move of creating some money circulation but the impacts could be worse.
Taxes are important to make the country survive but There is no trust and confidence left , unless this is developed there will be no stability at all .
I guess that amnesty scheme is dropped under IMF’s pressure.
Instead of blanket amnesty, govt is now focusing on operationalizing Special Economic Zones (SEZ) proposed under CPEC. This year 3 zones (in KPK, Punjab and Sindh) will be made operational. That will be a big achievement and will surely attract big investors from all over the world.
The countries who passing bills in parliament against accountability rather making it more strengthen don’t see any investors
And where the media and other institutions remain silent on such criminal acts is even worst
Taxation
Its a fact that PAK RE remains under-taxed. But also the problem is with little taxation there is hardly any good will services (regulation, tax incentives) for tax payers. Unless there is a fair system that favours the tax payers, people will always find loop holes to evade tax and they cant be blamed.
Amnesties
Too many amnesties hike up and once it expires the market falls and also issues with FATF so overdoing it may bring short-term benefits but it doesn’t yield longer-term impacts.
Accountability & FDI some quick facts
- Ehtasab Comission was closed in KP first of all, years ago.
- Javed Iqbal was a pure disgrace. Getting Horny while on official seat with Quaid Portrait right at top.
- Killed a Professor while chained and found no guilty later
- Killed Asad Munir later found no guilty
- Lost in UK courts paying hefty fines.
Let me introduce the FDI magnet, our esteemed Former Minister of Education.
Folks going mad at why to reform NAB.
Let me have the priveledge to introduce some glory moments for NAB, all in last 4 years … Just a tip of the Ice Berg.
Dear Imtiaz and Sohail, I have initiated a poll on the thread “This forum seems to be dead now”.
Appreciate if you can give your vote. Thanks.
Done! I would advice you gents, should you prefer to, to join the Forum Members Whatsapp group. Your presence and insights will be very valubale.
The group is smaller, focused, politically neutral (as much as it could be), centered around RE but also welcomes some socio-economic issues of the time. Do consider gents!
Agreed but no political kachra and if it does, it has to be good suggestions to the ruling party not personal attacks on all.
Here is analysis from my side. I have completed 1 year on this forum. LAst year you people came to know me after my budger analysis.
The newest tax is the form of “wealth tax” for property exceeding 2.5 crore. Tax experts are still struggling with the definition of “fair market value” and how it will be calculated. Secondly, plots sold/purchased during the year, how will that be accounted for.
Here’s a section on this item in budget commentary by AF Ferguson.
Most likely, this item will not see the light of the day. It challenges the most powerful ones.
Punjab Budget more taxes
At least some stakeholders are taking up the case to prevent RE sector from sinking.
Some RE related changes in finance bill.
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In section 7E for tax on deemed income, the word “immovable property” will be replaced with “capital asset”. This is to prevent it getting challenged in the court. This tax will be applicable form tax year 2022.
(comments: apparently this tax is here to stay as opposed to my earlier discussions with tax experts who believed that apex court has already decided against wealth tax in the past, so this one will not see the light of the day.) -
Overseas Pakistanis who had a NICOP would be included in the list of active taxpayers so they don’t have to pay additional taxes on property purchases.
Changes
From Russia with Love !
It’s a good news that Shahbaz is exploring cheap and available Russian fuel. If we can get some LNG cargos from Russia it will keep our gas-fired power plants and fertilizer industry going. Otherwise, we are doomed…
It will be tricky to avoid pressure form the west amid looming FATF threat and halted IMF loans. If Shahbaz gets some breathing space, then his parwaz will be unmatched !
My post (above) came out first. Then Business Recorder wrote this editorial with the same title.
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