Property valuation: Builders’ meeting with Dar today

The meeting of Finance Minister Ishaq Dar and Advisor to Prime Minister Haroon Akhtar with the 13-member committee of the builders and developers has been postponed until today (Thursday) morning. The members of the committee submitted their suggestions to the Federal Board of Revenue (FBR) on Wednesday.

Federation of Pakistan Chambers of Commerce and Industry (FPCCI) President Rauf Alam said a meeting was held Wednesday in the FBR office and most of the 13 members of the committee submitted detailed reports and suggestions to the FBR regarding the immoveable property valuations in their cities.

Association of Builders and Developers (ABAD) Chairman Hanif Gohar said that he also tabled his suggestions, in which he asked the finance minister to increase the collector value by up to 50 per cent to stop corruption in the valuation mechanism but on the other hand, the government should cut the Capital Gains Tax (CGT) on the transfer of property from 10 per cent to 5 per cent and regulatory duty by one per cent.

Following the suggestions submitted by the committee members, it is possible that the government will either accept the suggestions or announce an amnesty scheme for declaring undocumented money invested in immovable properties.

Sources said that the scheme may be called property investment regularisation scheme under which a person will be able to declare the amount more than the collector value for the purchase of immovable property. The declaration will be made as per the valuation that will be agreed upon between the government and the stakeholders at today’s meeting.

The sources said that if a person declared the value but paid more than that for the purchase of an immovable property will, on the identification of such the person, be asked for source of investment.

FPCCI President Rauf Alam has said the issue of valuers in property will create hurdles for the construction industry as well as the individual.

ABAD had strongly rejected the government’s efforts to give extraordinary discretionary powers to the income tax commissioner for determining value of property, terming it opening of another gateway of corruption.

Hanif Gohar warned the government to avoid unnecessary heavy taxation on the construction sector and raw materials including cement and steel, as this act will not only lead to massive flight of capital from this sector but also affect growth of tax net.