The International Monetary Fund (IMF) has urged Pakistan to crack down on tax evasion in the real estate sector, as reported on Monday.
Nathan Porter led a nine-member mission that arrived in Pakistan today to assess the country's economic performance and determine the release of the next $1 billion tranche.
According to sources, Pakistan and the IMF have begun talks on the $1 billion loan tranche under the $7 billion loan program. During the discussions, the IMF urged action against those misdeclaring property values.
As part of the proposed reforms, the Pakistani government assured the IMF that it would activate the Real Estate Regulatory Authority.
Sources revealed that authorities will impose strict penalties, including imprisonment and fines, on individuals and agents who falsely declare property values.
Sources revealed that individuals who fail to register could face a fine of up to Rs 500,000.
The government may grant the Real Estate Regulatory Authority the power to impose up to three years of imprisonment. The authority could also revoke the licenses of agents who provide false information.
Sources stated that authorities may fine real estate agents between Rs200,000 and Rs500,000 for providing incorrect details.
They added that misdeclaring property transfers could result in fines ranging from Rs500,000 to Rs1 million.
The new regulations seek to enhance transparency in the real estate sector and prevent financial fraud.
Nathan Porter and his nine-member mission will stay for about two weeks to assess Pakistan’s economic performance and decide on the release of the next $1 billion tranche.
Last month, the IMF team discussed climate finance with Pakistani officials and reportedly opposed a sales tax concession on locally sold electric vehicle parts, sources revealed. IMF officials recommended applying the standard tax rate in the new electric vehicles policy.
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