ISLAMABAD: Overseas Pakistanis are calling for waivers on withholding tax (WHT) and Federal Excise Duty (FED) for their first-time plot purchases in new sectors of Islamabad.
Additionally, they have rejected the requirement to make payments in U.S. dollars, citing financial constraints.
Concerns Over CDA’s Payment Policy
The demand follows the Capital Development Authority (CDA)’s recent Sector C-14 balloting, where successful overseas applicants were required to pay in U.S. dollars within 30 days of notification (sent on January 15).
However, tax experts highlight that many overseas Pakistanis find it difficult to remit funds in dollars due to high fees. They are urging the government to allow payments in Pakistani rupees instead.
Govt Forms Task Force to Address Real Estate Issues
In response, the federal government has formed a task force to propose reforms in the real estate and housing sector. A high-level meeting chaired by the Prime Minister is scheduled for today, where over 40 recommendations will be reviewed.
Tax consultant Shahid Jami pointed out that overseas Pakistanis struggle to claim withholding tax refunds as they do not have taxable income in Pakistan. He emphasized that many countries offer tax incentives to first-time homebuyers, a policy currently lacking in Pakistan.
Call for an Overseas Housing Authority
Jami suggested the establishment of an “Overseas Housing Authority” to streamline land acquisition and facilitate housing projects for Pakistanis abroad.
The push for tax waivers and policy changes underscores the critical role of overseas Pakistanis in Pakistan’s economy, particularly through remittances, and highlights the need for practical incentives to encourage their investment in the country’s real estate sector.
