” FBR assures IMF of incorporating real estate sector into tax net ” | GNN INFO

ISLAMABAD: Non-filers are set to face additional taxes on sale and purchase of plots as the Federal Board of Revenue (FBR) has assured the International Monetary Fund (IMF) of incorporating real estate sector into the tax framework, ARY News reported on Saturday, citing sources.

Sources told ARY News that the federal government will increase the taxes on non-filers for sale and purchase of plots and register the housing societies.

In order to document the real estate sector, it has been proposed to use banking channel instead of cash transactions. Sources added that all records, including cutting and purchasing, of plots in housing societies will be registered.

A coordination report on taxation of the real estate sector in the Centre and provinces will be submitted to global lender. Moreover, data of property agents and sale and purchase of plots will be registered in Federal Board of Revenue (FBR), sources added.

Sources claimed that measures would be taken in the upcoming budget to end undocumented transactions in the real estate sector. Furthermore, proposals to levy tax on transactions of files in the property sector will be prepared.

Sources added that seven per cent withholding tax for non-filers and four per cent gain tax was currently imposed on sale and purchase of plots. Meanwhile, tax evasion was being carried out on sale and purchase of files due to lack of a mechanism.

Earlier, the Federal Board of Revenue (FBR) has shared the tax revenue plan with the International Monetary Fund (IMF) delegation during second review talks under the $3 billion Stand by Agreement (SBA), citing sources, ARY News reported.

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The IMF delegation is currently in Pakistan for the second review under the SBA loan programme.

The FBR in its plan informed the IMF about the tax reforms, and steps to bring 3.1 million retailers and defaulters into the tax net to increase the country’s revenue.

The delegation was also briefed about structural reforms in the FBR and hoped to achieve a tax collection of Rs 9,415 billion.

According to the FBR, the target of IMF set for July to December 2023 was met as the body collected Rs4,468 billion against the set target of Rs4,425 billion.