Prime Minister Imran Khan Friday announced the opening of construction sector from April 14 to help daily wagers and labourers affected by continued lockdown due to COVID-19 outbreak to earn their livelihood.
Talking to reporters here, the prime minister said the government’s decision taken in coordination with the provinces is also aimed at reviving economic activities in the country, which are badly hit by the situation arising out of the coronavirus outbreak. He also announced various measures for the construction sector, including tax incentives, waivers and subsidies in the areas of sales tax, capital gains tax and withholding tax.
Giving details of the decisions, he said those investing in the construction sector during the year 2020 will not be asked any queries about the source of their income. Secondly, he said, the government has decided to bring the construction sector in the fixed-tax regime under which the rate of tax on land will be levied on the basis of per square yard and per foot. He, however, said those investing in the prime minister’s housing programme will be given 90% tax rebate and they will be required to pay just 10% of the total calculated tax amount on their projects. He said it has also been decided to waive-off withholding tax on cement and steel sectors. Besides, he said, in coordination with the provincial governments of Punjab, Khyber Pakhtunkhwa and Sindh, it has been decided to bring the sales tax in construction sector to 2% through consolidation of all taxes.
The prime minister said that capital gains tax on the sale of a house is being done away with. He also announced a Rs 30 billion subsidy for Naya Pakistan Housing Programme, adding that further subsidy will be given on its progress. He said the government has decided to give construction sector the status of an industry. It has also been decided to establish the Construction Industry Development Board (CIDB) to help promote construction industry in the country, he added.
The prime minister said all the decisions regarding the COVID-19 are being taken in coordination with the provinces. However, he said, any of the provinces can make changes as per their requirements.
He said since the Rs 1200 billion stimulus package announced by the federal government to provide financial relief to the poor and daily-wagers in the wake of lockdown due to coronavirus outbreak, the government has decided to open the construction sector. He said with the agriculture sector, which is already open, providing jobs to people in villages, the opening of construction sector, the main source of employment in urban areas, is very much needed.
The prime minister said besides the Rs 1,200 billion package, the government has launched an Emergency Cash Relief SMS Service under which Rs 150 billion will be distributed among the poor and the needy.
About 10 million people have so far applied for the financial assistance through the SMS service, he added.
The prime minister said the decision to open the construction sector has been taken because of the fact that the situation of coronavirus cannot be predicted. “We cannot predict what the situation will be after two or four weeks,” he remarked.
He said with medical sector, food processing industry, take-away restaurants and goods transport already open, the opening of the construction sector will bring a big relief to the daily-wagers and labour class. He, however, added that as schools, colleges, universities and wedding halls have already been shut down, the lockdown due to the coronavirus outbreak is continuing in the country.
Imran Khan rejected the notion being circulated on the social media that the spread of coronavirus in Pakistan is low due to strong immunity of its people, and said as there is no final word about the COVID-19, the citizens should take care of their health. He said the situation regarding the lockdown will be reviewed on April 14.
The prime minister referred to the situation after the Spanish Flue which revived back even after reaching its peaks and downs. He also referred to the situation of Chinese city of Wuhan after the outbreak of novel coronavirus and said the government of China had totally locked down the city for two months and provided the people with food and other essential items at their doorstep. “But my fear is that we will not be able to do this, because of our limited resources,” he said, and added that it is the reason that his government has decided to open the construction sector to save the daily-wagers and labourers from unemployment. The prime minister, however, vowed to fight the contagion together as a nation and said all the resources and capacities of the country will be utilized to fight and win the COVID-19 pandemic.
Prime Minister Imran Khan reiterated the stance of not implementing complete lockdown in cities as both Covid-19 and hunger are a challenge for the nation. He said the government cannot confine its around 220 million population to homes. “We are daily deliberating on how to confront coronavirus besides creating activities for the daily wagers and low income people – who are being adversely affected due the virus,” he added.
He said in case a complete lockdown is implemented, the situation in one month will be so adverse that it may result in casualties from hunger. He said whole nation will have to demonstrate utmost responsibility to observe social distancing to contain further spread the virus as police may not be able to control them with force. He said the whole nation will surely defeat the pandemic with unison and unity.
To a question about role of the provinces in announcing package for the construction sector, the prime minister said after the 18th Amendment, the Centre cannot dictate the federating units. He said the federal government elucidated the reasons of opening the construction sector to the provinces and it is now up to them to take any decision. He said Punjab and Khyeber Pakhtunkhwa governments are fully on board on the issue.
