Overseas Pakistanis have expressed strong opposition to making payments in US dollars for their first-time purchase of plots in Islamabad’s new sectors. Successful applicants in the Capital Development Authority’s (CDA) Sector C-14 balloting have urged the federal government to allow payments in Pakistani Rupees (PKR) and to withdraw withholding taxes and Federal Excise Duty (FED) on these transactions.

The CDA’s balloting for Sector C-14, which prioritized overseas Pakistanis, requires payments exclusively in US dollars within 30 days of January 15, 2025. However, many expatriates have raised concerns, citing a lack of liquid funds abroad and the additional burden of over 2% in banking charges for dollar transactions.

The applicants have also pointed out that US dollar remittances through banking channels have been slow, making it difficult to meet the payment deadline. Some buyers have even approached the Islamabad High Court (IHC) to challenge the dollar-only payment requirement.

In addition to the payment concerns, buyers are facing a 4% withholding tax, along with provincial taxes and stamp duty. Overseas Pakistanis, who typically do not have taxable income in Pakistan, find it challenging to claim tax refunds, further complicating the process.

The successful applicants are now pushing for these issues to be addressed in the federal government’s upcoming real estate development package. They have requested the CDA to allow payments in PKR instead of US dollars and to provide relief from withholding taxes and FED, which they argue disproportionately affect overseas buyers.

The CDA has received multiple requests from overseas applicants to revise the payment terms and address their concerns. The issue has highlighted the challenges faced by expatriates in participating in Pakistan’s real estate market, particularly in light of the country’s economic and regulatory environment