PM Imran unveils more incentives for construction sector

Date of fixed tax regime extended till Dec 31; buyers get three more years for disclosure of source of income


Our Correspondent December 31, 2020
Prime Minister Imran Khan. PHOTO: SCREENGRAB

ISLAMABAD:

Prime Minister Imran Khan on Thursday announced further incentives for the construction sector, saying that projects worth billions of rupees had been started in the country, which would generate economic activities worth Rs1,500 billion and create hundreds of thousands of new employment opportunities.

Premier Imran, while fulfilling a major demand of the construction sector, granted one-year extension in the date for the fixed tax regime and also extended the date for disclosures of source of income by the investors till June 30, 2021 and the one for buyers till March 31, 2023.

After chairing a meeting on the progress in the construction sector, the prime minister announced that the fixed tax regime had been extended till Dec 31, 2021, while the date for completion of the projects had also been pushed ahead by one year.

The prime minister described the measures as a New Year gift for the construction sector, which was the key to offset negative impact of the Covid-19 pandemic on the national economy. He also extended the date for completion of projects by one year.

In April, the government had announced a construction package, allowing people to invest in the sector, without disclosing source of income. According to the Federal Board of Revenue (FBR), the fixed tax scheme was applicable to builders and developers, who registered their projects with it.

Imran said that so far 186 projects had been registered with the FBR, under the construction package, while more projects worth Rs116 billion were in the pipeline. He added that work on 163 projects had been launched in Punjab, while projects worth Rs136 billion were in the approval phase.

“It is expected that the measures would generate an economic activity worth Rs1,500 billion and create 250,000 jobs in Punjab alone,” Imran said, adding that similar projects were in different phases in Khyber-Pakhtunkhwa, Karachi and Balochistan.

Citing the approval of the foreclosure law, he said, “Now the banks are extending loans for construction of houses for the low-income groups. Under the scheme, the banks will extend loans worth Rs378 billion by December 2021.”

He said the government would provide of Rs30 billion as subsidy on loan for markup for the low-cost houses, with a maximum of 5% on five-marla houses and 7% on 10-marla houses, adding that the government would provide a grant of Rs300,000 each for the construction of first 100,000 houses.

He said the major civic development authorities like the Capital Development Authority (CDA) and the Lahore Development Authority (LDA) etc had initiated automated approvals’ process.

He also mentioned that the master plans of all major cities were being revised. He said the government would also be taking into account the issue of food security due to the haphazard growth of the cities, which otherwise, would reduce the cultivable land. “The master plans will help resolve problems such as sewerage and water supply.”

Imran said the government was also digitising the land records in Karachi, Islamabad and Lahore, which would be completed by August. He added that the government was also in the process to digitise all government lands.

The prime minister emphasised that the Pakistan Tehreek-e-Insaf (PTI) government was the first, after 1960s, to work on promotion of industry for revenue generation, retirement of debt and creation of jobs.

He said that the strategy of smart lockdowns during the Covid-19 pandemic in Pakistan was very successful. “Pakistan handled the situation more successfully than other countries,” the prime minister added.

“Our government opened the construction sector at a time when the virus situation was having a negative impact on the economy all over the world,” he said. “The construction sector is currently growing rapidly, amid record sales in cement and increase in the sales and prices of steel.”

For the first time since the 1960s, the PTI-led government is working for industrial development. The government has decided to take up industries so that Pakistan's debts can be repaid and more employment opportunities could be created.

 

 

With additional input from APP

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