SM Tanveer concerned over 16% GST on property rentals

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LAHORE:

United Business Group (UBG) Patron-in-Chief SM Tanveer has expressed concern over the imposition of 16% sales tax on the rental of commercial properties in Punjab.

He feared that this new tax would significantly raise the cost of doing business and worsen an already fragile investment climate. He strongly criticised the step, calling it economically unsound and legally indefensible. He emphasised that such a move would lead to serious implementation and legal challenges.

According to Tanveer, renting commercial space in Punjab has just become prohibitively expensive. It would place an unsustainable burden on the already struggling retailers and entrepreneurs in a situation when economic activity is under immense pressure, he said, adding that such punitive measures risk driving legitimate, tax-compliant businesses into the informal sector.

The introduction of 16% sales tax on rental spaces is not just a financial blow; it is a signal that doing business is becoming increasingly unpredictable and risk-laden. He further emphasised that imposing additional taxes without proper consultation or impact analysis could lead to contraction in the formal retail sector, job losses and decline in investor interest, both local and international.

Tanveer warned that the current approach undermines the government's own stated objectives of economic revival, export enhancement and broadening the tax base through inclusive policies.