KARACHI: Chairman of the Association of Builders and Developers of Pakistan (ABAD), said that the federal budget 2024–25 would impose “heavy and unreasonable” taxes on real estate and the construction business, calling them “very destructive” for the industry. Sumsum also announced that the ABAD will file a lawsuit against these taxes.
He claimed in a statement that the budget has made it impossible for the average person to build a house, not just difficult.He questioned, “Can one say that a house built on 60, 80, or 120 yards is a luxury?” and said that high taxes had discouraged investment in the building industry. Millions of people would lose their jobs as it will “affect local industries” connected to the construction industry.
“Investments made in this sector by Pakistanis living abroad will be transferred to other countries, reducing the foreign exchange inflow, if the tax burden is not reduced,” he stated.
He stated that the ABAD had asked the government to boost the economy and had presented its recommendations. However, they increased taxes rather than providing relief to the building sector, which would ultimately be “the last nail in the coffin.”
According to the head of ABAD, it is totally unjust to impose a 60 percent tax and 3 percent Federal Excise Duty (FED) in the budget when there is already a 6-7 percent FED on real estate sales and purchases. He claimed that the amount of money sent home by Pakistanis living abroad has significantly decreased after the immovable property tax went into effect in 2022.
In the midst of an already impending shortage of more than 10 million homes, Pakistani citizens are no longer able to build their own homes due to high levies on the construction industry.”The provision of housing for citizens is the fundamental duty of the government. He went on, “If the government is unable to carry out this duty, it ought to safeguard the building industry.” He predicted that as taxes and tariffs rose, Karachi’s informal settlement population would rise.
