Pakistan Construction Sector Relief Package – Challenges & Opportunities

Prime Minister of Pakistan, Imran Khan, on April 17, 2020 announced Pakistan Construction Sector Relief Package for the builders & developers. Check gazetted copy of the official notification here.

Pakistan’s economy has experienced frequent boom and bust cycles. Generally each cycle comprised of 3-4 years of relatively higher growth followed by macroeconomic crisis which required the stabilization programs – the IMF-Program. Despite stability efforts of the Government, confidence among businesses and consumers is still weak.

In last fiscal budget, the PTI Government introduced some documentation and tax relief measures, which however, largely remained ineffective in producing desired results. Recent outbreak of COVID-19 has further aggravated the situation of economic meltdown.

In his address to the Nation on 3^rd April 2020, the Prime Minister, Imran Khan, shared intentions of the Government to introduce relief package for construction sector, which links more than 50 industries. PM briefly announced the relief package for the construction industry. To give effect to the relief package, the Government has promulgated the Tax Laws (Amendment) Ordinance, 2020 (Amendment Ordinance/ Relief Package) on 17^th April 2020.

This post provides an overview of the amendments introduced through the Amendment Ordinance. It also briefly discusses the challenges expected to address while implementing these relief measures. I have prepared the document below for the information of all stakeholders, and is based on the information publicly available. Definitions of important terms are given at the end of the document. Find detailed analysis of Pakistan Construction Sector Relief Package in this file: