Real estate investment trust’s unable to seek funds from PSX due to high taxation regime

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Pakistan Stock Exchange (PSX) has seen a dearth of listings from the real estate sector despite construction booming in the country. This has been blamed on strict taxation measures of the government due to which many projects have been cancelled.

The Arif Habib Dolmen REIT Management Limited Chief Executive Officer Muhammad Ejaz said “At least eight mega projects in the real estate sector worth approximately Rs80b have shelved plans to get listed at the PSX in the last two years.” As per Ejaz, the higher taxes enacted last July by the government discouraged real estate investment trusts (REIT) to seek funds from the PSX. He also mentioned that his company is the only listed one from the sector on the PSX and it took them more than 10 years to do so.

Ejaz also added that his company itself had abandoned plans for five REIT’s aside three others which included Packages’ Packages Mall, Nishat Group’s Emporium Mall in Lahore and Lucky Cement’s Lucky One Mall in Karachi. He stressed that the government needed to remove the barriers in terms of additional taxes which would help them to record details about construction and real estate projects and generate higher receipts in the process.