The International Monetary Fund (IMF) has instructed Pakistan to raise the advance tax on the purchase of immovable properties in the upcoming budget.
The IMF has directed senior officials of the Federal Board of Revenue (FBR) to increase the advance tax on non-filers for the purchase of immovable property. In the current fiscal year, the FBR imposed a 3 percent tax on filers and a 10.5 percent tax on non-filers, collecting Rs. 80 billion. Now, the IMF has instructed an increase in the advance tax on non-filers for property purchases.
The IMF has proposed a tiered tax system for property purchases. For properties up to Rs. 50 million, a 3 percent tax on filers and a 6 to 7 percent tax on non-filers is suggested. For properties worth Rs. 50 million to Rs. 100 million, the proposed tax rates are 4 percent for filers and 12 percent for non-filers. For properties over Rs. 100 million, the IMF recommends a 5 percent tax on filers and a 15 percent tax on non-filers.
Sources indicate that the IMF informed Pakistani authorities that implementing this plan could generate over Rs. 100 billion if approved by parliament for the next fiscal year.
