KARACHI: The Federal Board of Revenue (FBR), through Finance Bill 2017, has proposed to disallow refund and adjustment against tax withheld on sale of properties in line with a budgetary announcement for the fiscal year of 2017-18.
The government has proposed an amendment into Income Tax Ordinance 2001 to withdraw the refund and adjustment facilities against property transactions made during a tax year.
Through Finance Act 2016, the government increased withholding tax rates on sale and purchase of immovable properties by 100 percent. Under the revised rate on property sale, a seller, who is a filer, is liable to pay one percent on the gross amount of the transaction, and a non-filer has to pay two percent. Earlier, these rates were 0.5 percent and one percent. Similarly, on purchaser of property, withholding tax rate was up to two percent in case of filer and four percent in case of non-filer, from the previous rates of one percent and two percent.
