Finance Act 2013: builders, land developers rope into 'Minimum Tax' regime
Builders and land developers have been roped into the 'Minimum Tax' regime in the Finance Act 2013. The Bill placed in the National Assembly by Federal Finance Minister Ishaq Dar levies a minimum tax at the rate of Rs 25 per square foot as per construction or site plan on builders. And Rs 50 per square yard on development and sale of residential, commercial or other plots in accordance with the layout or site plan approved by the regulatory authority.
Copyright Business Recorder, 2013
According to tax experts the actual construction is normally different from the approved plan since building bye-laws are stringent and builders/constructors feel that their projects would be commercially unviable if constructed as per bye-laws. Shops are normally shown as parking area on the ground and mezzanine floor. Local governments are responsible for plan approvals and FBR has no connectivity with them.