KARACHI: Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on Wednesday requested the government that property valuation rates should match market values, which will ensure in checking tax evasion worth of Rs7t in the real estate sector.
Head of FPCCI Standing Committee on FBR affairs, Shakeel Dhingrah said the current property valuation rates weren’t a reflection of open-market rates.
According to Dhingrah, even if the Federal Board of Revenue (FBR) raises its valuation by a 100pc the real valuation would be less even then, he said.
As per estimates, almost Rs8t is said to have been invested in the real-estate sector, which accounts for almost ¼ of the country’s Rs33.5t GDP.
In June, it had been reported FBR had been successful in collecting Rs 2b in taxes on property transactions under an amnesty scheme introduced for real estate sector last December. This amnesty scheme was said to be an opportunity for individuals to convert their black money into white.
The Income Tax (Fourth Amendment) Act, 2016 was enacted last year on the 2nd of December, which provides people reprieve from their source of funds being questioned through the aforementioned act.
Dhingrah urged FBR to work on measures for industrial growth instead of making fruitless investments in the real-estate sector. At the moment, three valuation tables exist for immovable property in the country which are namely provincial deputy collector (DC) rate, FBR tables and open market rates.
He added that DC and FBR property valuation rates should be equal to open market prices and recommended the FBR to look into property advertisements before final evaluation of the property valuation prices it intends to fix.