Major relief 'proposed' for construction sector, overseas Pakistanis in Budget 2025-26

ISLAMABAD: Prime Minister (PM) Shehbaz Sharif has directed authorities to provide major relief to the construction sector in Budget 2025-26, ARY News reported citing sources.

According to Federal Board of Revenue (FBR) sources, the measures include scrapping the Federal Excise Duty (FED) on property transactions for overseas Pakistanis, eliminating the requirement for a No Objection Certificate (NOC) from Regional Tax Offices (RTOs), and proposing the removal of FED on property purchases for all categories—3% for filers, 5% for late filers, and 7% for non-filers effective from July 1, 2025.

Additionally, the budget is expected to reduce or eliminate withholding tax on raw materials for the construction industry and property transactions.

FBR sources revealed that Prime Minister Sharif has taken a personal interest in resolving issues plaguing the sector, with plans to register all builders and developers associated with real estate starting July 1, 2025, to ensure transparency and eliminate benami (anonymous) transactions by 100%.

The Pakistan government is likely to unveil Rs17.68 trillion budget 2025-26 on June 10, well-placed sources said.

According to details, a significant decline in the policy rate is expected to reduce expenditure on loans and interest payments by approximately Rs1,300 billion in budget 2025-26.

Sources suggest that the size of the upcoming federal budget could be around Rs17.8 trillion, which is Rs 900 billion less than the current fiscal year’s budget of Rs18.7 trillion.

The upcoming budget will place strong emphasis on austerity measures in Pakistan, which will be implemented rigorously.

Sources also indicate that the purchase of new vehicles for all federal ministries and departments will be prohibited. Additionally, ministries will be expected to limit their electricity and gas expenses.