At Makani Marketing, we understand the critical role the real estate sector plays in the economy. Recently, the President of the Islamabad Chamber of Commerce & Industry (ICCI), Ahsan Zafar Bakhtawari, highlighted the importance of supporting the real estate sector to strengthen the Pakistani Rupee against the US Dollar.
The Current State of the Real Estate Sector
The real estate sector in Pakistan has faced significant challenges in recent months. Many businesses have shut down due to unfavorable conditions. Ahsan Zafar Bakhtawari emphasized that facilitating the real estate sector could shift public investment from gold and dollars to real estate, thereby strengthening the Pakistani Rupee.
Taxation Issues
One of the main issues raised by Bakhtawari is the taxation imposed under section 7E. He pointed out that withholding and advance taxes have doubled, which discourages people from becoming tax filers. Instead, this move might push more people away from the tax net, harming the economy further.
Former ICCI President Sardar Yasir Ilyas Khan also voiced his concerns. He stated that despite paying heavy taxes, businessmen are not receiving the necessary facilitation. He criticized the decision-makers for imposing heavy taxes without providing basic facilities, describing it as a sign of “illiteracy.”
The Need for a Broader Tax Net
Both Bakhtawari and Khan stressed the importance of broadening the tax net rather than overburdening those who are already taxed. Pakistan’s tax-to-GDP ratio stands at a mere 9 percent. By broadening the tax net, the government can increase revenue without discouraging investment in real estate.
Stakeholder Consultation
Tahir Khan, President of the Islamabad Estate Agents Association, emphasized the need for government consultation with relevant stakeholders before imposing new taxes. He highlighted that the recent budget’s taxation measures are seen as unfair and could deter people from investing in real estate.
Recommendations
Tahir Khan recommended reducing taxation on real estate transactions. This reduction could lead to a higher number of transactions, thereby increasing overall revenue collection. By facilitating the real estate sector, the government can create a more favorable investment climate, ultimately strengthening the Pakistani Rupee.
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Conclusion
The real estate sector is a cornerstone of Pakistan’s economy. At Makani Marketing, we believe that by addressing the concerns raised by industry leaders and implementing fair taxation policies, the government can boost investment in real estate. This, in turn, will help strengthen the Pakistani Rupee against the US Dollar and contribute to overall economic stability.
For more insights and expert advice on real estate investment, contact Makani Marketing today.
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