Islamabad: Chairman of the Federal Board of Revenue (FBR), Rashid Mahmood Langrial, recently shared updates on the government’s decision to abolish the Federal Excise Duty (FED) on property transactions.
He confirmed that a summary outlining the removal of the FED has been sent to the Cabinet for approval, and once the Cabinet grants its approval, the policy will be implemented immediately.
Langrial emphasized that the Prime Minister has already given the green light for this significant move. He further clarified that there will be no specific limit set for property purchases under the new policy.
As part of the reforms, the 3% FED imposed on property purchases by filers, the 5% FED on late filers, and the 7% FED on non-filers will all be abolished.
This change is expected to reduce the financial burden on property buyers, boost market activity, and provide relief across various segments of the real estate sector.
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The Federal Excise Duty (FED) on property transactions in Pakistan has been a significant financial burden on property buyers, particularly in the real estate sector.
These taxes had discouraged investment in the property market and hampered growth.
With the impending abolition of these duties, the government hopes to make property transactions more affordable and encourage greater participation in the real estate market.
Notably, no limit will be imposed on property purchases under the new regime.
The removal of FED is expected to foster a more favorable environment for both local and foreign investors, provide relief to buyers, and revitalize the real estate sector, which plays a crucial role in Pakistan’s economic development.
FED Removal Decision
In a significant move aimed at boosting Pakistan’s real estate sector, the government has decided to abolish the Federal Excise Duty (FED) on property transactions.
Initially introduced in July 2024, the FED stood at 3% for tax filers and 5% for non-filers.
However, following the Prime Minister’s approval, the decision to completely withdraw these charges is expected to bring much-needed relief to property buyers, sellers, and investors.
Real estate experts have hailed this move, predicting a surge in market activity.
Muhammad Ahsan Malik, a real estate consultant, emphasized that easing the financial burden of transfer charges will be crucial in revitalizing the sector, helping stabilize property prices and encouraging investment.
Also Read: Good News for Real Estate: Govt to End FED on Property Sales
Simultaneously, the Ministry of Housing has approved the initial draft of the National Housing Policy 2025, which is seen as a long-term strategy to address the country’s housing crisis.
With a shortage of around 10 million housing units, the policy aims to promote urban planning, microfinance for housing, and the use of local construction materials, while protecting agricultural land.
It also focuses on industrial growth within the construction sector, creating jobs and encouraging foreign investment.
Experts agree that the success of both the FED abolition and the National Housing Policy will depend on transparent implementation and effective follow-through.
