ISLAMABAD: The government is considering extending the construction package from 3 to 6 months in terms of PM Imran Khan’s tax amnesty for the construction sector.
The plan will expire on Thursday. Discussions on expanding the scheme have been ongoing for some time as more than 350 projects have been registered under the scheme to date with an estimated cost of Rs 140 billion.
The Prime Minister’s Office has instructed the Federal Board of Revenue to prepare a draft presidential decree expanding the amnesty tax scheme.
Sources said the government is currently considering extending the deadline from three to six months to take advantage of the scheme. However, the final decision will depend on whether the International Monetary Fund approves the proposal.
The PM announced his government’s second plan for a tax amnesty that allows people to invest in the construction sector without revealing their income source. The construction sector is the prime minister’s main project and he is betting on its recovery to boost economic activity.
The scheme was also presented on projects that were built before the scheme’s announcement. The condition was that the new and ongoing project would be substantially completed by September 30, 2022, in accordance with current legislation.
At the moment, 355 projects have been registered under the scheme, worth 140 billion rupees. The sources included 137 plans that were underway before the amnesty was announced and the actual reason for giving the amnesty.
Sources said the government is considering extending the construction project start date from December 2020 to March 31, 2021. In this situation, the project completion date will also be extended to the end of December 2022 from the end of September 2022.
The second option was to extend the deadline from December 2020 to June 2021 – an extension of six months. Sources said: “In this state, the project implementation period may be extended until March 2023.”
The government will have to amend the Income Tax Act to extend the scheme, either through a regular financial bill or through a decree.
Sources said: “Furthermore to the 355 projects currently registered under this scheme, there are 261 other schemes at the stage of registration, worth 125 billion rupees.” These 261 projects have not yet met all the practical requirements for using the scheme.
Though, the authorities said there are 900 more candidate projects worth more than Rs 1 trillion that could benefit from the scheme, and this was also one of the reasons for extending the deadline.
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