Government Halts Tax Relief for Property Purchases

It is reported by Express Tribune that the government has halted property tax relief, which was going to be announced to force growth in 2020. 

The government created a task force on property, and it was advised by them to slash taxes on property transfers and provide certain relief; however, Express Tribune reported that it is halted for now or, in the short term, it won't happen. 

Moreover, the reason provided to halt tax relief for properties was IMF and FBR chair resistance. It is reported that the FBR chairman resisted the idea, and he said the IMF program may be jeopardized by this move, and Pakistan may face more issues than any benefit of this amnesty. 

The FBR chairman said that this cannot be done, that there should be no questions asked on property purchases up to 50 million PKR, as it will again increase the informal economy, and Pakistan will face more issues from the IMF and international partners like the FATF and WB. 

Pakistan could have faced backlash from FATF (Financial Action Task Force) for giving such a relief, which helps to avoid anti-money laundering and financial terrorism. Moreover, anywhere in the world, such measures are practically impossible now due to FATF and IMF conditions. 

Moreover, the UAE used to give these kinds of benefits till 2021, and now it is all over due to FATF downgrading them to the gray list. Therefore, the government of Pakistan was advised by the FBR chairman to halt such a message, which makes Pakistan suffer, and even the IMF won't agree to such measures as the IMF is asking to increase documentation, and we cannot give such relief at this stage. Moreover, Pakistan is facing a tax shortfall for the current fiscal year of around 468 billion rupees.