Real estate transaction taxes may be reduced in FY27 budget to attract overseas investment

The government is considering reductions in transaction taxes on immovable properties in the 2026-27 federal budget to lower costs for buyers and sellers and attract investment from overseas Pakistanis into the housing sector, Business Recorder reported, citing sources.

The Federal Board of Revenue (FBR) has drafted different proposals for the real estate sector as part of the Finance Bill 2026. Proposals under review include cuts in withholding tax and capital gains tax on the sale and purchase of immovable properties.

The FBR has already revised down the values of immovable properties by 30% to 35% in Islamabad, Rawalpindi, Faisalabad, Sialkot, Multan, Bahawalpur and Gujranwala from April 22, 2026.

The government also informed the National Assembly Standing Committee on Finance that talks were underway with the International Monetary Fund (IMF) on reducing withholding tax rates on property transactions in the 2026-27 budget.

Sources said the government recognised the need to reduce transaction taxes on buying and selling immovable properties.