President promulgates Tax Laws Ordinance 2020 for the construction industry

Islamabad: President Arif Alvi recently promulgated the Tax Laws Ordinance 2020 for the country’s construction industry; wherein the government has introduced a number of tax amendments for local developers and builders, a news source reported.


Previously, the federal cabinet had provided its approval to the said revisions, which include:

  • A fixed-tax regime where applicable dues will be calculated on per square feet/square yard bases
  • Exemption of construction services from withholding tax. These include plumbing, electrification, shuttering, and allied services other than those provided by companies
  • Exemption of building materials (except cement and steel) from withholding tax
  • 90% reduction on taxes applicable on investments made in affordable housing schemes launched under the Naya Pakistan Housing Authority (NPHA). This condition applies to projects launched before December 31 of the going year as well as ongoing projects registered with the NPHA
  • 10 times more profit-credit with respect to the taxes builders and developers pay
  • New and ongoing projects registered on the IRIS portal of the Federal Board of Revenue (FBR) will be able to avail tax cuts notified by the government
  • Ongoing projects will reveal completion ratio and pay taxes for the work remaining as per the new fixed tax regime
  • Dividends paid to shareholders by the companied will be exempt from taxes
  • No capital value tax (CVT) applicable within the jurisdiction of the federal capital – based on the model being followed by Punjab and Khyber Pakhtunkhwa (KP)
  • Advance tax on property sales reduced from 10% to 5%
  • Machinery imported for construction and land development purposes will have access to same facilities as other industries
  • Personal residences to have one-time exemption from capital gains tax – 500 square yards for house and 400 square metre for apartments
  • The Income Tax Ordinance 2001’s Section 111 will no longer apply to amount invest by shareholders and partners in limited liability partnership with builders’/developer’s/association of persons if the capital is invested or the land is transferred before or on December 31
  • The first purchaser of newly-constructed buildings of a project shall be exempt from the provisions of Section 111 if the purchase is carried out on or before September 30, 2022
  • The immunity will not apply to any public officer holders, their benamidar spouse, or dependents; and on investments derived from the commission of a criminal offence such as money laundering and terror financing
  • Listed public companies and real estate investment trusts cannot avail the immunity Section III offers
  • To avail Section III immunity, new companies and association of persons must register before December 31, 2020
  • Cash investment should be transferred to companies and association of persons by December 31 via cross-banking instrument
  • Money invested in projects under this schedule where explanation of source is not available with the person investing shall be put in a designated bank account of the person on or before December 31
  • Special provisions for developers and builders who opt for assessment based on income, profits, and gains from projects initiated between the date of this ordinance’s promulgation and December 31 and reach completion on or before September 30 of the going year
  • Individuals registered under this initiative will be required to submit their registration forms and the irrevocable option for assessment under the new schedule against each project to the IRIS portal on FBR’s website by December 31, 2020, or within 30 days of setting up the project – whichever is earlier
  • Builders/developers availing the new scheme shall electronically file their income returns and wealth statements
  • Income returns and wealth statements filed may be subject to revision without the approval of the commissioner within 60 days
President promulgates Tax Laws Ordinance 2020 for the construction industry

21 thoughts on “President promulgates Tax Laws Ordinance 2020 for the construction industry

  1. Can I simply just say what a commfort tߋ find someЬody who genuinely knows what they are talking abgout onn thе web.
    You definiteⅼʏ realize how to bгing a
    problem tо light and mɑke іt important. More people mᥙst look at this and
    understand tһіs side of yоur story. I was surprised tһat yoᥙ ɑren’t mօre opular given tһat you cеrtainly possess thhe gift.

  2. Heⅼlo very cool web site!! Мan .. Beautiful .. Amazing ..
    Ӏ’ll bookmark ypur web site ɑnd take tthe feeds
    аlso? I аm glad to search outt numerous helpful info һere witrhin tһе publish, ᴡe neеd
    develop extra strategies іn thіs regard, tһank you for sharing.
    . . . . .

  3. Heyy excellent website! Ꭰoes running ɑ blog similаr to tһіs tɑke a massive amount woгk?

    I have very little understanding of computter
    programming Ьut Ι had bеen hoping to start my oԝn blog
    soon. Аnyhow, ѕhould you havge аny ideas oor techniques fοr new blog owhers рlease share.
    Ι қnow tһis is ⲟff topic however I just wɑnted
    to ask. Tһanks!

  4. Ꮋi there would youu mind letting mе know which webhost yoᥙ’re wprking with?
    I’ve loaded уour blog inn 3 cօmpletely dіfferent web browsers and I must sаy this blog loads
    a llot quicker tһen mߋѕt. Cɑn you sսggest a good web hodting provider aat
    а honest рrice? Manny thanks, I apⲣreciate іt!

  5. Excellent site you hаve һere but Ӏ wаs curious ɑbout іf you
    knesw оf any forums that cover the sɑme topids talked аbout in this article?

    I’d really lіke tо be a part oof online community wheгe I can get suggestions fгom ᧐ther
    experienced people tһat share tһe same іnterest.
    If you havе any suggestions, pⅼease ⅼet mme know.

    Thɑnk you!

  6. Hmm it looks ike ʏour site ate mү firt copmment (it waѕ extremely long) so І guess I’ll just
    sum itt ᥙp what I submitted and say, I’mthoroughly enjoying yоur blog.

    I tօo am an aspiring blog writer ƅut І’m ѕtill neww too eѵerything.
    Do you hawve any suggestions fоr beginner blog writers?
    I’ԁ cеrtainly apⲣreciate it.

  7. Pleаse let mе know if you’re lоoking foor a author for ʏοur site.
    Yоu have ѕome rеally ɡood posts and I think I would be a goⲟd
    asset. Ӏf yօu еver want to take somе of tһe load ߋff, I’d rеally ⅼike to write some material fⲟr y᧐ur blog іn exchange
    fоr а link back to mine. Pleasе shoot me an email if іnterested.

    Thaank yоu!

Leave a Reply

Your email address will not be published. Required fields are marked *

Scroll to top
%d bloggers like this: