Attractive Incentives for Real Estate Builders and Investors in Pakistan:
If you are looking for a long-term investment then the safest option is the real estate sector. For investment purposes, the current trend in Pakistan is to follow real estate investments. Moreover, the rising demand has given rise to several attractive endeavors. According to the current statistics Pakistan spends around 5.2bn in construction every single year.
As of 2021, the real estate sector has topped the charts for the most lucrative investment sectors. Secretary Board of Investments Fareena Mazhar encourages investors to explore the housing industry of Pakistan during a seminar for the construction and housing for sustainable development that was held in Dubai. There were other opportunities and investments that were also discussed during this session.
The Secretary noted that builders and investors are encouraged to introduce all kinds of new projects to help boost real estate development. The current housing demand in Pakistan is annually around 700,000 and as of now, only half of this is being met. The existing deficit can be seen as an opportunity for other investors. With the current policies and factors that are at play, new players are encouraged to diversify into the field of real estate. To highlight the main opportunities and incentives that are offered at the moment are:
Tax Payable for Income and Profits:
Naya Pakistan Housing Scheme is one of the best examples of tax exemption policies of the current regime. The government of Pakistan has introduced a housing project that will develop housing units for locals at subsidized rates and accommodate a low-cost housing opportunity for daily wagers.
For the builders and developers who are working for Naya Pakistan, the housing scheme will get a 90% off on all their income and profits. As a result of this, the development projects are being developed on both government and private land. The models for the two kinds of investment projects differ slightly however the facilities and incentives that are offered remain the same.
Exemption from the withholding taxes:
The BOI secretary also addressed the fact that an amendment has been made in the Tax Ordinance as of late that declared the construction sector a full-fledged Industry. With the help of this amendment, the industry is eligible for incentives, benefits, and concessions which are also available for the other Industries.
The exemption for withholding taxes can be availed for all the eligible builders and investors who are purchasing construction material. Provisions 150 and 153 of the income tax ordinance will not apply in this case. It also states the apart from the services that are provided by the companies, the withholding of tax shall not be applied for plumbing, electrification, and shuttering services.
Opportunities for Investors and Developers:
The government has provided these facilities and incentives for the real estate investors and developers because of the promising nature of this Industry.
There are incredible investment opportunities that you can avail yourself of as an investor in Karachi, Multan, Islamabad, Rawalpindi, Lahore, and Faisalabad. These are places where people have both desire and means to invest in lucrative property investments.
To promote demand the Government has also fixed targets on the Banks to promote the housing and construction industry of Pakistan. This has given people in other parts of the country an opportunity to invest in the real estate of their choice.
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