ISLAMABAD: Federal Board of Revenue (FBR) and property dealers are likely to develop a consensus on increasing values of immovable properties by 50 percent during the second round of talks today (Thursday) at the Board’s headquarters.
Sources explained the situation, saying, if the existing official value (DC rate) of property stands at Rs10 million and its actual market value is Rs100 million, the official value will be increased by 40 percent to 50 percent.
On the request of property dealers, the FBR has increased number of cities from 18 to 21 for working out fair market value and now both sides would sit together to find out amicable solution on valuation of property acceptable to all sides.
The cities selected for the valuation tables include 10 from Punjab: Lahore, Rawalpindi, Jhelum, Gujranwala, Gujrat, Sialkot, Faisalabad, Multan, Rahim Yar Khan and Bahawalpur; three from Sindh: Karachi, Hyderabad and Sukkur, and Peshawar and Abbotabad from Khyber Pakhtunkhwa, and Quetta and Gwadar from Balochistan. Islamabad Capital Territory will be dealt as a separate entity.
The list of DC rates contains several categories depending upon the size of the city – like the DC rates in Karachi has five categories starting with A1 which includes areas like Bath Island, Clifton, Durajee, KDA Officers Scheme etc it is followed by Category 1 and the last category is Category 4 which includes Liquatabad, Landhi, Korangi, Paposh, Keamari, Hawksbay etc, industry sources added.
The FBR’s commissioners and valuators have estimated that the fair market value of property in Karachi and Islamabad was higher by 10 to 12 times on average and in Lahore it was higher by 5 to 6 times compared to district commissioner-determined (DC) rates for payment of taxation purposes.
FBR Chairman Nisar Muhammad Khan wants to resolve the issue before his visit to Dubai on Sunday for holding review talks with the IMF.
Last week, both the sides agreed on introducing amnesty scheme for regularising past transactions of property where fixed tax in the range of 2 to 5 percent will be imposed but the source of income will not be questioned.
The government decided to abandon the valuation mechanism through State Bank of Pakistan valuators with this condition that the table of DC rates will be jacked up to bring it at par with fair market value.
