In a move that could reshape Pakistan’s real estate and construction landscape, the federal government is preparing to revise its construction sector relief package following objections raised by the International Monetary Fund (IMF), according to sources reported by ARY News.

Originally launched by Prime Minister Shehbaz Sharif, the package aimed to stimulate real estate growth in Pakistan, boost the construction industry and offer tax relief for property buyers. However, the IMF flagged parts of the initiative as a form of “amnesty,” raising concerns about its compatibility with broader fiscal reform policies under the Fund’s ongoing support program.

 

Key Highlights of the Proposed Changes:

• First-time property buyers (non-filers) may get tax exemption on purchases up to Rs 5 million.
• The existing 8% tax on property purchases for filers may be scrapped.
• Proposal to eliminate the 3% federal excise duty on property transactions.
• Federal Minister for Economic Affairs Ahad Cheema is overseeing the restructuring of the relief package.
• The revised proposal will be presented during the upcoming IMF review mission.

This policy shift is being carefully restructured to balance investor incentives with transparent governance. The changes come in the wake of the IMF-led Governance and Corruption Diagnostic Assessment (GCDA), which involved key discussions with institutions such as the Auditor General of Pakistan.

 

What It Means for the Real Estate Market:

The potential reforms could unlock new opportunities for investors and revive stalled development projects, particularly in urban centers like Lahore, Islamabad, and Karachi. With reduced tax burdens and increased clarity, the market is likely to see increased participation from both domestic and overseas Pakistanis looking to invest in real estate in Pakistan.

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