ISLAMABAD: The Federal Board of Revenue (FBR) on Tuesday directed its field formations to increase property valuation rates to bring them closer to market values, starting next month.
Talking with media FBR Chairman Amjed Zubair Tiwana said that the new rates will be finalised in the coming days across more than 50 cities.
“I have directed the regional tax offices to revise the valuation rates,” he said, noting that the process had been delayed due to tax officials’ involvement in finalising indicative incomes and tax rates for retailers under the Tajir Dost Scheme.
The FBR did not raise property valuation rates last year due to a change of government. Property values, currently around 75 per cent of market value, are expected to increase to 90pc of estimated market rates.
The tax authority has previously adjusted property valuations four times, in 2018, 2019, 2021 and 2022.
Since 2016, the FBR has been carrying out the task of determining a property’s fair market price in major urban centres. In the provinces, valuation tables are typically notified by the district collector under Section 27-A of the Stamp Act of 1899.
The revised property tables will be used to calculate federal taxes, including capital gains tax (CGT) and withholding tax. Internationally, tax is charged on the transaction value, but in Pakistan, the collector value is often much lower than the actual transaction value.
FBR Chairman confirmed that the FBR had completed the preliminary work to revise property valuations. He said tax officials would complete the revisions for over 50 cities shortly, aiming for implementation by Sept 1. The new rates will then be officially notified.
He said tax officers had been busy finalising tax rates with trader representatives. The final rates for indicative incomes and fixed rates are now being notified.
