Prime Minister Imran Khan announces to open the construction sector from 14 April with a historical relief package of Rs. 100 billion and to give “status of industry” to the Construction sector to maintain “balance” between the economy and lockdown during coronavirus pandemic.
While talking to media after the National Coordination Committee (NCC) about Coronavirus and the challenges Pakistan is facing due to this, PM said that hunger is the great challenge we are facing. He said that we need to target the situation wisely with proper planning to mitigate its effects on our economy and the poor class.
The industry status being given to the construction sector will resolve various problems faced by the workers and construction companies. It will also improve the construction quality however the projects will become more economical by eliminating unnecessary costs.
The government has decided to resume the construction sector from 14 April as the nationwide lockdown against coronavirus outbreak has become a great challenge for the economy of Pakistan. This industry will be able to work under certain conditions and precautions that will ensure the safety of the workers.
The labor of our country is affecting on a great level because of such circumstances. The industrial sector will be elevated as PM has announced the necessary incentives for investors. He stressed that through the opening of this sector, the daily wagers will be able to earn as many of them are losing their income due to the current situation.
The major monetary package for construction sector announced by Govt. includes the following points:
- Remarkable tax relief will be given to the construction sector on certain measurements where the tax on land would be charged on per foot or square yard basis.
- The investors would not be asked about their source of income, this year.
- Construction sector to be declared as an industry so that it can enjoy tax credits while the Construction Industry Development Board will regularize all its functionality.
- The sales tax in the construction industry will bring to 2% and this is decided with the coordination of all the provincial governments.
- FBR rates revisions of all the properties and reduction in taxes.
- On construction property, holding period for Capital Gains Tax (CGT) will be reduced to 3 years from 4 years.
- CGT reduction on plots.
- Sales tax on construction materials will be reduced.
- Real estate project approval to be done within 45 days.
- Families who want to sell or buy a house would be free from capital gain tax.
- Naya Pakistan housing scheme investors will have to pay only 10% tax of the total tax and the other 90% tax would be waived off.
- The government will give the subsidy of Rs 30 Billion to Naya Pakistan Housing Scheme.
The purpose of amnesty to the construction industry is to grow the employment opportunities as well as to continue the construction work even in the lockdown. Moreover, it will also provide great relief to the other sectors connected with the construction sector.
The timely refund of Rs100 Billion to the industry and business communities is given so that they do not face any liquidity issue. Construction Industry Development Board (CIDB) will be formed to manage and promote the construction industry under the conditions and reliefs given by the government of Pakistan.
Prime Minister stated that the agriculture sector is already open in Pakistan as it is a source of great income in the rural areas however the opening of the construction sector is crucial to support labor class and to grow income prospects. He then referred to the nation as strong and courageous enough to know how to rise from this crisis.