Govt Relaxes Property and Car Purchase Rules for Non-Filers

Finance Minister Muhammad Aurangzeb has announced a Rs. 36 billion mini-budget as part of Pakistan’s broader fiscal policy reforms aimed at enhancing revenue collection while easing the tax burden on low and middle-income citizens. The new measures reflect a recalibrated approach to economic management, focusing on equitable taxation, rational enforcement, and targeted revenue generation.

Revised Asset Purchase Restrictions

Initially, the government planned to bar individuals from purchasing assets such as homes, vehicles, or making large transactions if their declared income did not support such spending. However, on the Prime Minister’s instructions, the enforcement scope has been narrowed to high-end purchases only.

Now, the restrictions will apply to:

• Cars exceeding 1,600cc or priced above Rs. 7 million
• Residential properties over one kanal in major cities and two kanals in others
• Annual cash deposits above Rs. 100 million
• Annual stock investments over Rs. 50 million

These revised rules significantly scale back the Federal Board of Revenue’s (FBR) enforcement powers, citing operational limitations in effectively implementing broad asset-purchase monitoring.

Tax Measures to Raise Rs. 36 Billion

To recover lost revenue and meet fiscal targets, the finance minister introduced three primary tax adjustments:

1. Debt Portion of Mutual Funds (Corporate Investors):
   Tax rate increased from 25% to 29%
2. Corporate Income from Government Securities:
   Tax raised from 15% to 20%
3. Federal Excise Duty on Day-Old Chicks:
   Imposed at Rs. 10 per chick, projected to generate Rs. 15 billion annually

These measures aim to balance budgetary demands without placing excessive burdens on everyday consumers.

Relief for Middle Class, Retirees, and Housing Sector

Several relief-focused announcements were made, addressing the concerns of salaried individuals, retirees, and the real estate sector:

• No withholding tax on the sale of residential property held for over 15 years
• Post-retirement benefits such as gratuity and commutation remain tax-exempt
• Annual pensions exceeding Rs. 10 million will be taxed at 5%, while pensioners over 75 remain fully exempt
• Income tax rate for individuals earning Rs. 600,000 to Rs. 1.2 million annually has been reduced from 2.5% to 1%
• Launch of a 20-year low-income housing loan scheme

These initiatives are aimed at providing financial relief and promoting long-term economic stability.

FBR Powers Reformed to Prevent Misuse

In a significant move to curb misuse of authority, new guidelines were issued for arresting individuals accused of tax fraud:

• Arrests above Rs. 50 million fraud require a court-issued warrant
• Arrests allowed only after three formal notices, evidence of record tampering, or if the person is a flight risk
• Arrest must be approved by a three-member FBR committee and produced before a special judge within 24 hours

These measures are designed to protect taxpayer rights while maintaining accountability in serious cases of evasion.

Fiscal Strategy and Broader Outlook

The Rs. 36 billion in new tax measures is part of the government’s broader fiscal strategy, which also includes Rs. 312 billion in new budgetary taxes and Rs. 389 billion expected from enhanced enforcement. This comprehensive approach supports Pakistan’s ongoing efforts under international financial frameworks, including commitments to the International Monetary Fund (IMF).

The finance minister’s announcement indicates a careful balancing act—targeting high-value sectors and corporate entities while offering relief to vulnerable groups. However, the effectiveness of these reforms will depend heavily on implementation and economic resilience amid global uncertainties.

Disclaimer:
The information provided in this article is based on official announcements and publicly available data as of June 2025. Policies may change subject to government decisions and legislative processes. Readers are advised to refer to the Ministry of Finance or the Federal Board of Revenue (FBR) for the latest updates. This content is intended for informational purposes only and does not constitute financial or legal advice.

Afsheen Gohar

Afsheen Gohar is a seasoned writer with a wealth of experience in crafting authentic and well-researched articles. Her dedication to delivering high-quality content is evident in her work, where she combines a passion for storytelling with a commitment to accuracy and depth. Afsheen’s writing reflects her ability to engage readers with compelling narratives while providing valuable insights on a diverse range of topics.