The Federal Board of Revenue (FBR) has announced to provide 90 percent tax exemption on low cost housing projects, in order to promote the present government’s New Pakistan Housing Project.

The FBR and the New Pakistan Housing Development Authority in a statement assured the public and investors in the construction industry that the construction package announced by the Prime Minister for builders and developers is making significant progress. ۔

This package came into force under the Income Tax Ordinance 2001 with the addition of Section 100D and the Eleventh Schedule Amendment under the Tax Laws Amendment Ordinance 2020.

The FBR said that the scope of the construction package is wide under which very attractive tax concessions can be availed. This construction package is applicable to land builders and developers and covers both new and existing industrial and development projects.

Builders and developers can get tax benefits on residential and commercial construction. These benefits also accrue to individuals, associations of individuals and companies, said FBR.

Under this package, fixed tax rate will be applicable for builders and developers per square foot and square yards. Under this package, in case of low cost housing projects, tax will be reduced by 90pc.

FBR informed that for the convenience of the shareholders of the companies, no tax will be levied on the profits. Under this package, significant exemption in holding tax has also been given

There will be no questioning of investment income on fulfillment of conditions for builders and developers and property buyers to promote investment.

FBR said that builders and developers must register on FBR's Iris software by December 31, 2020.

Builders and developers will have to ensure completion of the project by September 30, 2022. Registration will require bank account, ownership documents and approved plan details.

On facilitating builders, FBR said that its system is also facilitating temporary registration while the project plan is in the process of approval. Online support is being provided for the convenience of builders, developers and buyers.

So far 348 people have registered 389 projects with a total value of Rs. 157 billion.