ISLAMABAD – Pakistani government came up with 30percent tax credit for individuals buying flats and 10-marla houses in latest bid to boost affordable housing and urban development.
The development surfaced during a session of the National Assembly’s Standing Committee on Finance as officials got detailed briefing by Federal Board of Revenue (FBR) Chairman Rashid Mahmood Langrial, who outlined a series of major tax reforms in the real estate sector.
Langrial said the tax credit scheme is aimed at supporting middle-income buyers, especially those investing in vertical housing projects in cities. “This initiative is designed to promote legal, documented, and affordable home ownership,” he noted.
Revised Withholding Tax Structure
Sharif led government offered relief on purchases while increasing taxes on sales. Additionally, the Federal Excise Duty (FED) on property deals has been abolished to ease financial pressure on buyers.
| Transaction | Property Value | New WHT Rate |
|---|---|---|
| Purchase | Up to Rs 50 million | 1.5% |
| Rs 50 million – Rs 100 million | 2% | |
| Above Rs 100 million | 2.5% | |
| Sale | Up to Rs 50 million | 4.5% |
| Rs 50 million – Rs 100 million | 5% | |
| Above Rs 100 million | 5.5% |
FBR officials explained that the tax adjustments aimed at rationalizing system and improving documentation in real estate sector. However, he admitted that the International Monetary Fund (IMF) has raised concerns about the reduction in purchase-related WHT, warning it could undermine revenue targets.
To tackle undocumented transactions, the government also proposed Rs30,000 fine for registered businesses accepting cash payments exceeding Rs200,000 for the sale of goods.
These reforms are part of the broader fiscal strategy aimed at enhancing tax compliance, curbing the undocumented economy, and making property ownership more accessible for Pakistan’s urban middle class.
Withholding Tax on Non-Filers’ Cash Withdrawals increased to 0.8pc in Budget 2025-26
