LAHORE: Section 203A of the budget 2021-22, which gives powers to arrest and prosecute any person for concealment of income to assistant commissioners of Inland Revenue Service merely based on an accusation or doubt, should be withdrawn immediately. In addition, the government should abolish the proposed 20 % gain tax on the real estate sector. Policies formulated without stakeholder consultation can never succeed.
These views were expressed by Khawaja Shahzeb Akram, Senior Vice President, Muhammad Ali Mian, Coordinator and Maj ® Muhammad Rafiq Hasrat, Convener of the standing committee on “Property & Construction of Federation of Pakistan Chambers of Commerce and Industry (FPCCI) while addressing to the joint press conference at FPCCI Regional Office Lahore.
They said that Oversees Pakistani invested heavily in real estate and received record remittance in 2020-21. In addition, almost 29 billion dollars were received in government exchequer, thereby boosting our foreign exchange reserves.
The federal government in the Budget 2021-22 has proposed drastic changes which will result in the collapse of real estate business, and trillions of rupees invested in real estate will get stuck for a long time. Losses of investors will be colossal and unbearable. Overseas Pakistanis will also suffer heavily and will stop investing in real estate. Heavy losses in real estate will discourage overseas Pakistani, and the flow of remittance will be badly affected, resulting in less remittance in the falling year. They added.
Referring to the shutdown of gas to industries, Shahzeb Akram said that due to untimely action of the government regarding LNG and CNG, industries are facing a shortage of gas today.
Maj ® Muhammad Rafiq Hasrat, Convener of the FPCCI standing committee on “Property & Construction, said that previously the maximum rate of tax on profit on real estate business was 10%, and it was calculated in a receding manner. After three years, the tax on profit from the sale of the property was zero%.
He further said that Overseas Pakistanis should be given a special rebate on investment in Pakistan. The proposals in the current Finance Bill proved to be detrimental to the real estate and construction sectors. The decline in the real estate business will also reduce the government’s income tax revenue.
They further said that even 10% maximum gain tax has brought irreparable damage to the real estate market and all the people connected therewith. Therefore, the maximum gain tax should not be more than 8 percent.
Maj ® Muhammad Rafiq Hasrat further said that government must protect the real estate sector. The provincial and federal government should register the agents involved in real estate businesses, and at least 2 per cent commission as services charges be protected by law. He further demanded from the government to immediately restore the old regime of property gain tax.
