The federal government has approved lower advance tax rates on property transactions under the Finance Bill 2026-27. However, it also increased taxes on banks and corporate entities. The revised measures will take effect from July 1.
Under the new structure, sellers will pay 2.75 percent advance tax on the property’s total value. Meanwhile, buyers will pay 1.25 percent advance tax based on the fair market value.
Property Tax Rates Revised
The revised tax rates aim to ease the burden on property transactions. Consequently, buyers and sellers will benefit from lower advance tax obligations. The changes will apply nationwide from the start of the new fiscal year.
Officials introduced the revisions as part of broader fiscal reforms. Furthermore, the government aims to balance revenue collection with support for key economic sectors.
Higher Taxes for Banks and Companies
The Finance Bill also raises taxes on banking companies and corporate entities. From July 1, banks and fertilizer companies will pay a 10 percent tax on income exceeding Rs. 150 million.
Meanwhile, other corporate companies will face an 8 percent tax on income above Rs. 500 million. Therefore, the government expects the revised structure to strengthen revenue generation while adjusting sector-wise taxation across the economy.
