Thursday Jan 27, 2022
ISLAMABAD: Federal Minister of Finance Shaukat Tarin directed the Federal Board of Revenue to extend the deadline to implement revised property valuation rates in 40 urban cities until March 1, 2022.
The FBR must first gain the confidence of all stakeholders, including the provinces, before establishing valuation rates for the entire country, Tarin said.
Tarin made this decision during a meeting on Wednesday with a delegation of the Real Estate Consultants Association (RECA) headed by Ahsan Malik at the Finance Division.
Secretary-General RECA, Ahsan Malik, told The News that Tarin listened to all their concerns and assured them that they would be resolved amicably. The real estate sector desires a single national valuation rate rather than three distinct rates, including the DC notified valuation rate in their respective areas, FBR rates, and market rates.
The real estate industry wants property valuation to be delegated to provinces in their respective regions. However, the World Bank's $400 million loan under the Pakistan Raises Revenues initiative includes a requirement that the FBR's valuation rates be updated to reflect market rates.
It remains to be seen how the FBR will proceed with further increases in the valuation rates used to calculate FBR taxes. The real estate tycoons argued that it would be difficult to implement the exorbitant valuation rates because doing so would put an end to the sector's boom. It will become more difficult for buyers to demonstrate the whole of their white money, and in some cases, the money to an extent that is inconsistent with market prices.
According to real estate representatives, this would deter genuine buyers who would rather transfer land in their own names. They inquired as to how the FBR would handle situations in which files were sold but no transaction occurred in front of registration authorities.
Previously, the FBR extended the deadline to implement revised property valuation rates in 40 major urban areas by delaying its notification until January 31, 2022. The FBR increased valuation rates by up to 700 percent in 40 different cities via an official notification issued on December 1, 2021, sparking protests across the country.