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December 24, 2020

Amnesty date for developers, builders may be extended

Business

December 24, 2020

KARACHI: The government might extend the last date for availing an amnesty related to developers and builders owing to overwhelming response and hindrances in regulatory approval, sources said on Wednesday.

The last date for availing amnesty was expiring on December 31, 2020 for builders and developers to deposit their undeclared money in a separate bank account for completion of projects by September 30, 2022.

Quoting from a recent high level meeting, sources said the prime minister was informed about developers and builders showing interest and depositing around Rs800-900 billion for about 500 housing projects.

The prime minister was further informed that those projects were at different stages of regulatory approval.

In view of the information, sources said that the centre was considering extending the date up to June 30, 2021 from the current last date of December 31, 2020. “Furthermore, the project completion date from September 30, 2022 to June 30, 2023 is also under consideration,” sources added.

The incentive package was promulgated through Tax Laws (Amendment) Ordinance, 2020 whereby a new section 100D and Eleventh Schedule were inserted in Income Tax Ordinance 2001 through Finance Act, 2020.

Announced by Prime Minister Imran Khan, the construction package has a vast scope and offers handsome tax incentives to the industry.

A host of incentives include fixed tax regime and withdrawal of withholding tax. However, the main incentive given under this package includes immunity from questioning the source of investment on money deposited in a bank account and the money spent on new or existing projects started from April 2020. However, this immunity is available only to those projects that should be completed by September 30, 2022.

Association of Builders and Developers (ABAD) Chairman Fayyaz Ilyas has hailed the incentive package and said that due to the new coronavirus, all business activities witnessed a slow down.

The chairman said when the package was launched, the government had announced that relevant authorities would grant regulatory approval within 45 days. However, it was not done as per commitment, he added.

He said that the association had appealed the prime minister to extend the date for effective utilisation of the package. ABAD had demanded the premier to extend the date for at least one year, Ilyas added.