Islamabad, June 24, 2025: The Federal Board of Revenue (FBR) has approved a major tax relief for homeowners in the newly passed Finance Bill 2025–26, effective from July 1. As per the amended law, the withholding tax on the sale of immovable property will no longer apply if the property has been used as a personal residence for 15 years or more. This move is expected to ease the financial burden on long-term property owners.
The tax removal follows recommendations from the National Assembly’s Finance Committee, which also advocated for stronger legal protections in tax fraud investigations. New Senate-backed clauses have been incorporated to ensure no arrests are made without proper legal procedures.
In a significant win for real estate stakeholders, the government has also withdrawn the proposed 3% Federal Excise Duty (FED) on the transfer of property. This comes as part of broader tax reforms aimed at balancing revenue generation with public interest.
Additionally, the bill introduces a new Energy Vehicles Adoption Levy targeting internal combustion engine (ICE) vehicles. Although hybrid cars are not yet exempt, the finance committee has requested that the FBR consider removing them from the levy to promote green transportation. The new tax is projected to generate Rs. 10 billion in revenue.
Meanwhile, the FBR has reversed a key customs amendment concerning low-value imports. Previously, courier parcels worth up to Rs. 5,000 were allowed tax-free entry. Starting July 1, only gift parcels valued at Rs. 1,000 or less will be eligible for exemption. Furthermore, the de-minimis threshold has been reduced to Rs. 500 to curb the growing trend of under-invoicing.
To protect legitimate importers, new regulations will allow customs authorities to waive penalties in cases where shipment delays are beyond the importer’s control. A new clause has also been added to block false or delayed ownership claims on confiscated goods.
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These changes reflect the government’s intent to reform taxation while ensuring fair treatment for citizens and businesses alike.
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