{"id":104785,"date":"2026-02-17T11:24:26","date_gmt":"2026-02-17T06:24:26","guid":{"rendered":"https:\/\/www.zameen.com\/news\/?p=104785"},"modified":"2026-02-24T12:58:22","modified_gmt":"2026-02-24T07:58:22","slug":"experts-demand-abolition-of-section-7e","status":"publish","type":"post","link":"https:\/\/www.zameen.com\/news\/experts-demand-abolition-of-section-7e.html","title":{"rendered":"\u2018Relief for construction sector meaningless without Section 7E abolition\u2019"},"content":{"rendered":"\n<p>Islamabad: Experts have warned that the government\u2019s expected relief package for the construction sector will remain ineffective unless controversial provisions of Section 7E of the Income Tax Ordinance, imposing tax on deemed income from immovable properties, are abolished or substantially amended.<\/p>\n\n\n\n<p>According to real estate experts, Section 7E has discouraged domestic investment in the property sector, pushing capital towards foreign markets, particularly the United Arab Emirates (UAE). They stressed that without withdrawing this tax, any relief announced for the construction industry would fail to revive activity in the sector.<\/p>\n\n\n\n<p>Read: <a href=\"https:\/\/www.zameen.com\/news\/slash-interest-rate-to-revive-property-sector-abad.html\" target=\"_blank\" rel=\"noreferrer noopener\">ABAD urges SBP to slash interest rate to revive construction sector<\/a><\/p>\n\n\n\n<p>According to the experts, meaningful relief also requires rationalisation of withholding taxes on property transactions. While the government reduced withholding tax rates under Section 236K on the purchase of immovable properties in the last budget, it simultaneously increased withholding tax rates under Section 236C on property sales to offset potential revenue losses.<\/p>\n\n\n\n<p>They noted that advance withholding tax rates for buyers were reduced by 1.5 percentage points across all slabs, but corresponding increases of 1.5 percentage points were imposed on sellers or transferees. Despite the provision allowing tax adjustment, the sharp increase in withholding tax on property sales has effectively nullified the relief granted on purchases.<\/p>\n\n\n\n<p>As a result, experts said, the intended incentive for property transactions has failed to materialise, further dampening sentiment in the real estate and construction sectors.<\/p>\n\n\n\n<p>Read: <a href=\"https:\/\/www.zameen.com\/news\/experts-urge-green-reforms-in-construction-sector.html\" target=\"_blank\" rel=\"noreferrer noopener\">Experts urge green reforms in Pakistan\u2019s construction sector<\/a><\/p>\n\n\n\n<p>Official data shows that the Federal Board of Revenue (FBR) collected Rs118,882 million under Section 236K during fiscal year 2024-25, compared to Rs104,124 million in 2023-24, reflecting an increase of 14.2 percent. Meanwhile, collections under Section 236C rose to Rs118,107 million in 2024-25 from Rs95,950 million in the previous year, registering a sharp increase of 23.1 percent.<\/p>\n\n\n\n<p>Experts argued that unless Section 7E is withdrawn and withholding tax rates on property sales are reduced, the government\u2019s proposed construction relief package will have little practical impact on reviving the sector.<\/p>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Islamabad: Experts have warned that the government\u2019s expected relief package for the construction sector will remain ineffective unless controversial provisions of Section 7E of the Income Tax Ordinance, imposing tax on deemed income from immovable properties, are abolished or substantially amended. According to real estate experts, Section 7E has discouraged domestic investment in the property sector, pushing capital towards foreign markets, particularly the United Arab Emirates (UAE). They stressed that without withdrawing this tax, any relief announced for the construction industry would fail to revive activity in the sector. Read: ABAD urges SBP to slash interest rate to revive construction sector According to the experts, meaningful relief also requires rationalisation of withholding taxes on property transactions. While the government reduced withholding tax rates under Section 236K on the purchase of immovable properties in the last budget, it simultaneously increased withholding tax rates under Section 236C on property sales to offset potential revenue losses. They noted that advance withholding tax rates for buyers were reduced by 1.5 percentage points across all slabs, but corresponding increases of 1.5 percentage points were imposed on sellers or transferees. Despite the provision allowing tax adjustment, the sharp increase in withholding tax on property sales has&hellip;<\/p>\n","protected":false},"author":18,"featured_media":63726,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[15016],"tags":[24276,71168,19230,71167,37769,61435,34475,4575,33,61709,61708,57341,1109,3822],"persona":[],"class_list":{"0":"post-104785","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-new-developments","8":"tag-construction-sector","9":"tag-deemed-income-tax","10":"tag-federal-board-of-revenue-fbr","11":"tag-housing-and-construction","12":"tag-income-tax-ordinance","13":"tag-investment-climate","14":"tag-pakistan-economy","15":"tag-property-taxation","16":"tag-real-estate","17":"tag-section-236c","18":"tag-section-236k","19":"tag-section-7e","20":"tag-tax-reforms","21":"tag-withholding-tax","22":"cat-15016-id"},"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.2 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Real estate experts demand abolition of Section 7E-Zameen News<\/title>\n<meta name=\"description\" content=\"While the government reduced withholding tax rates under Section 236K on the purchase of immovable properties in the last budget...\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.zameen.com\/news\/experts-demand-abolition-of-section-7e.html\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Real estate experts demand abolition of Section 7E-Zameen News\" \/>\n<meta property=\"og:description\" content=\"While the government reduced withholding tax rates under Section 236K on the purchase of immovable properties in the last budget...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.zameen.com\/news\/experts-demand-abolition-of-section-7e.html\" \/>\n<meta property=\"og:site_name\" content=\"Pakistan Real Estate News &amp; 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