FY26: Proposal to reduce FED on real estate sector under consideration

Islamabad: The federal budget for the fiscal year 2025-26 has proposed to reduce taxes on the property sector, abolishing the Federal Excise Duty (FED) for the property and real estate sector, and starting the registration of builders and developers.

The budget document has proposed to reduce taxes on the property sector, provide incentives for overseas Pakistanis to invest in construction, and change the withholding tax on property transactions.

Sources say consideration will be given to abolishing the FED on property for overseas Pakistanis, and provide incentives for overseas Pakistanis to invest in the construction sector.

It has also been proposed to abolish the FED on property for overseas Pakistanis, and change the excise duty for late and non-filers on property purchases.

The budget also proposes to change the withholding tax on property transactions. Sources add if these proposals are approved, investment in the property sector could increase once again.