Daily Times

Securities and Exchange Commission (SECP) has submitted its tax proposals for budget 2021-22 for documenting the real estate sector and promotion of Real Estate Investment Trusts (REITs).

The SECP suggested reducing tax on dividends from REITs from 25 percent to 15 percent to synchronise it with mutual funds [First schedule, Part-1, Division-III, paragraph B] of Income Tax Ordinance, 2001. The SECP suggested to exempt advance tax on property transfers to/from a REIT Scheme u/s 236C and 236K of Income Tax Ordinance, 2001. The SECP proposed exemption for CGT provided in clause 99A, Part 1, 2nd schedule be applied to all categories of REITs (mix-use projects) without any sun-set clause

The SECP said that core objective of the proposals included to support government vision for development of housing sector and allied industries; promote regulated real-estate sector for promoting documentation and transparency; introduce level playing field for regulated sectors; remove disadvantage/dis-incentive caused to the REIT sector; and increase overall tax revenue for FBR and provincial revenue authorities.