The increased property tax has disappointed property investors and buyers throughout the country. They find these heavy taxes on the real estate sector of Pakistan unjustified and consider it a Government’s move to discourage them from investing in the property market.
A rise of more than hundred percent on property transfer fee, Stamp Duty, Gain Tax and CVT and DC rates has kept a lot people from investing in the market right now. While there are some people who would like to associate this reduced activity in the property market with the prevailing unstable political condition of the country, the fact remains that the increased taxes have played a major role here.
If we look at the way property sector operates in Pakistan, we would all agree that the industry is still to mature, where, despite the online fund transfer facility and availability of efficient database management solutions, property buyers are still at the mercy of patwaris and land mafia. The tall claims and big promises of rescuing the real estate market of Pakistan from the shackles of patwari mafia turned out to be nothing but a part of politicians’ election campaigns.
As of yet, nothing concrete has been done in this regard. To trick people, these patwaris are instead given some fancy names as well as a promotion in their ranks. Is that going to make these patwaris respectable? Will that actually help anyone? The answers to these questions are not hard to gauge.
On October 17, 2014, the Excise and Taxation Department of Punjab advertised in the local newspapers that the proposed 150% rise in the property tax has been reduced to 50%. According to this advertisement, this step has been taken to facilitate the property investors. The Government of Punjab has informed the property taxpayers to not pay anymore amount than 50% rise levied on the existing property tax, except for the properties that have been restructured or those put to a different use.
The Government of Punjab has found out that some officials are sending bills of property taxes with more than 50% of the prescribed tax rise. If you too have been one of the victims of the mafia that has corrupted the property and taxation department of Pakistan, you should call on 0800-02345 and register your complain. The number is active daily between 8:00 am to 8:00 pm.
This ad claims that your complain will be addressed and necessary action will be taken against the concerned officials. You should register your complain on this number and also share your experience with us by commenting on this article.
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Dear Samra Zulfiqar sahiba
Couple of days back, I requested one clarification about property tax but did not receive any reply.
My question is Can “property tax” be adjusted in income tax return? e.g. I have annual income 100000 and my property tax is assume 40000 and paid it at due date. Can I adjust it in my annual return?
Regards
M Abdullah
Sharjah
UAE
Contact: 00971505271862 & 00971552445361
Dear Abdullah,
Please accept my apology if some of your comments were left unanswered by us.
About adjusting property tax with income tax, it is not possible, i believe, since income tax and property tax are handled by separate departments in Pakistan. You can discuss the matter in detail with Shakeel Ahmed: 0344-7055262.
Thanks a lot Samra Zulfiqa sahiba for quick response. Surely, I will talk to Shakeel Ahmed sb.
You are welcome M. Abdullah.
Please correct the date october 17,2015
Thank you very much for correcting this Tariq Siraj.
Dear Samra Zulifqar,
very well written about unjustified taxes upon real estate sector.It is true government wants to discourage investment in this sector by increasing number of taxes and their rates too. During current financial year government has imposed a new advance tax on purchasing of any property valued from 3 million and above, for tax filer it is one percent and for non filer it is doubled.As a result market prices have fallen from 25% to 33% in small sectors like I-11,I-14,I-16.Government should impose less taxes in this sector and can earn more by encouraging people to invest in real estate.
mam you had a huge platform in real estate sector but i am not convinced till date why u have not been able to made an authentic chart showing say islamabad property taxes applicable as on date . the working paper may look like
1. Capital gain tax purchased and sold after 01.08.2016
10% (if sold in one year)
7.5%(if sold in 1-2 years)
5% (if sold in 2-3 years)
no tax if sold after 3 years
if purchases before 01.08.2016 but sold within 3 years time then flat rate of
5% would apply
payable by seller
no tax on property valuing less than 4 million
no tax on martyr’s family plots
50% on govt employees and overseas pakistanis
no distinction on filer or non filer
tax is on gain/profit not the agreement amount .
ask your legal team to check all what i mentioned above and then reproduced on your web site
same is the case with other taxes , like capital value tax, withholding tax etc
how you find the idea. it will boost your portal professional impact.