Karachi: The Federal Board of Revenue (FBR) has reduced income tax on low cost housing schemes by fifty percent, according to a news report. Projects where maximum price of a residential unit is PKR 2.5 million would count as low-cost housing schemes.

The amendment has been introduced through the Finance Act, 2018. Under the amendment, tax payable on profits and gains derived by a person from low-cost housing projects shall be reduced by fifty percent. For the law to be applicable on a housing scheme, it has to be owned and managed by a company registered under Companies Act, 2017.

The housing scheme should not formed by splitting, reconstruction or reconstitution of an already existing business. Finally, the maximum price of any single housing unit in the project should be PKR 2.5 million.