Salaried taxpayers paid nearly 360 percent more tax than the real estate sector during the first four months of the current fiscal year, as a reduction in property-related tax rates cut the sector’s withholding tax contributions by Rs. 34 billion.

Provisional figures show that the salaried class paid approximately Rs. 193 billion in income tax between July and October, compared with just Rs. 42 billion collected from the real estate sector.

The difference reached Rs. 151 billion, highlighting the widening disparity between tax collections from salaried individuals and property transactions.

Real estate withholding tax collections fell 45 percent from Rs. 76 billion in the corresponding period last year, reflecting the impact of the government’s decision to reduce advance taxes on property sales and purchases.

Property Sector Gets Rs. 34 Billion Tax Relief

The government’s latest budget reduced advance tax on property sales from 5.5 percent to 2.75 percent, while the rate on purchases was lowered from 2.5 percent to 1.25 percent.

The changes followed the government’s decision to reverse some of its earlier measures aimed at discouraging speculative investment in the property market.

The reduction is visible in tax collection figures. Advance tax collected on property sales dropped 48 percent, from Rs. 52.7 billion to Rs. 27.3 billion during July-October.

Similarly, tax collected on property purchases declined 37 percent, falling from Rs. 23.1 billion to Rs. 14.7 billion.

Meanwhile, income tax collected from salaried individuals increased from Rs. 179 billion to Rs. 193 billion, adding around Rs. 13.5 billion to government revenue.

Wholesalers and retailers jointly contributed Rs. 24.7 billion during the period, marking an increase of 2.5 percent.

Combined tax collections from retailers, wholesalers and the real estate sector stood at approximately Rs. 67 billion, around Rs. 126 billion below the amount collected from salaried taxpayers alone.

The Federal Board of Revenue (FBR) recorded a revenue shortfall of Rs. 95 billion during July-October, while overall tax collection growth remained limited to 6.5 percent.