Islamabad: The government intends to tax the capital gains of PKR 5 million or more on the sale of immovable property and bring property taxation under ‘normal tax regime’ in budget 2021-22, news sources reported. In Finance Bill 2021-22, the CGT on immovable property was proposed to be amended to flat 5% up to the capital gain totaling PKR 5 million, as compared to existing tax slabs of 2.5 % to 10% – depending on the revenue generated.
According to government officials, the move is part of efforts to simplify the real estate tax regime and meet revenue projections for the fiscal year 2021-2022 (FY22). Finance Minister Shaukat Tarin announced the move during the budget session and deemed it necessary to adjust the business losses in the current fiscal year
However, there is some unrest among the realtors and developers over the proposed tax regime. The real estate industry insiders have flagged the development as a move that will create hurdles for the development of the construction business.
However, the members of real estate businesses have met the Federal Board of Revenue (FBR) ahead of budget to voice their concerns, and they are also scheduled to meet the prime minister to resolve the issues pertaining to tax regime change.