Increase in DC rate, new taxes perturb realtors

LAHORE

The increase in deputy commissioner (DC) rate and new taxes have perturbed the real estate agents.

Real State Association and Defence Housing Authority State Agents Association President Major (retd) Muhammad Rafiq Hasrat said that the business of the real estate is on the verge of collapse due to an increase in DC rate and the hike in the rate of per square kilometre.

Further, he said the Federal Board of Revenue is planning new taxes.

He said, “New taxes would discourage investment in real estate as the sector may lose attraction for overseas Pakistanis. Now overseas Pakistanis are not investing in the real estate. Consequently, the inflow of remittances in the country is dwindling. The country may miss 21 billion dollars which are sent by the overseas Pakistanis.” While addressing a press conference at Lahore Press Club on Tuesday he made aware of his grievances.

He said there was a heightened fear of capital flight from the country if the heavy taxes on real estate were not withdrawn since no one will invest in the property business. He alleged that investors have started asking for refunds on booked properties.

“Panic in the market will have a serious impact on the national economy,” he added.

He appealed to the government to withdraw new taxes and not to raise the value of the property. He said the Punjab government steps would not help it to achieve its revenue targets in view of declining deals in future. He said many deals between buyers and sellers were cancelled in view of new taxes.

He said the rates in DHA phases, 6, 7, and 8, have decreased much fold due to new taxes. “Now only 25 files are being sold instead of 100 in any housing society. The decrease in the sale of files is due to new taxes. ”

He said that the activities in this sector were already minimised since the new tax regime was introduced by the government in July this year. He said the government should stop the economic murder of people attached with real estate sector. He appealed to the federal and provincial governments to stop harassing the real estate agents and freeze new taxes on the property for next three years.

Pakistan’s real estate sector witnessed bullish trend in the last two years, thanks to flawed policies of the government, he further noted.

Real estate agents from different parts of the country were shocked in July last year and staged protest rallies in different parts when the government imposed a new tax on property transactions.

The federal government had increased the minimum rates of properties in various cities of the country and passed a law that allowed the FBR to evaluate the market price of properties being sold across the country.

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