The federal government has decided to impose a levy on the taxable profit of every person deriving income from the business of construction and sale of residential and commercial buildings.

According to the amended Finance Bill, the tax would also be imposed on the development and sale of residential commercial or other plots; or the construction and sale of residential, commercial or other buildings.

The government has proposed a taxable profit shall be 10 per cent tax of the gross receipts in “construction and sale of residential, commercial or other buildings.”

Moreover, a taxable profit shall be 15% of gross receipts in respect of “development and sale of residential commercial or other plots and 12% of gross receipts in above mentioned businesses.

The government has clarified that the provisions of the section shall only apply in respect of income accruing from gross receipts from activities specified in above mentioned businesses and shall not be applicable to income or incomes from any other source or under any head of income.