ISLAMABAD: The Senate Standing Committee on Finance, Revenue has directed the Federal Board of Revenue (FBR) to revoke the recently issued SRO with regard to the revised valuation of immovable properties.
The meeting of the standing committee was held under the Chairmanship of Senator Talha Mehmood at Parliament House here on Monday.
Committee member Senator Kamil Ali Agha expressed his reservations regarding the mechanism adopted by FBR in determining the values of properties. He asserted that the tax department has increased the value of properties from 100 to 700 per cent without any logical justification and rationale.
Anomalies exist not only at the federal capital but district level as well as FBR has not consulted with the real stakeholders,” he added.
Chairman FBR said that the department has adopted the same mechanism for revaluation of immovable properties as practised in the past; however, he said that the department does not have sufficient resources for a comprehensive on-ground assessment of properties.
The representatives of the real estate sector informed the committee that FBR has increased the value of properties without any due deliberation in Islamabad, Lahore and other cities of Punjab.
The rates of properties have increased in Islamabad from Rs5 million to Rs40 million. The rate of plot in DHA phase-1 has been increased to Rs90 million from Rs25 million.
ABAD former chairman Arif Jeewa said that there is a need to review the valuation of properties in Surjani Town Karachi. “He said that FBR did a consultation in determining the properties value of Karachi but did not consult relevant stakeholders in Punjab and Islamabad.
Chairman FBR said that no valuation table existed five to six years ago and that the Pakistan Muslim League-Nawaz (PML-N) government had given FBR the mandate to determine properties rates.
He said that many people had whitened their black money worth Rs350 billion within a year and a half under an amnesty scheme.
He also revealed that the Financial Action Task Force (FATF) is constantly monitoring these issues and now the time has changed as the department cannot just make a 15 per cent increase in the rate of properties. “However, I will make consult the finance advisor so that a solution can be worked out,” he added.
Senator Sherry Rehman said that it seemed like that the state and the government are going bankrupt which is why the government is taking such steps. However, the FBR head answered that the new values had been determined in good intention and it is possible that the price may be higher or lower somewhere but the tax department is ready to revaluate of immovable properties.
The chairman committee said that FBR should provide ample time for the industry to comply and adjust their businesses for all future regulations, besides taking all the relevant stakeholders on board.
He also directed the FBR to revoke the recent SRO issued in this regard and urged FBR officials to determine the value of immovable properties in consultation with relevant stakeholders in the next fifteen days.
It is pertinent to mention here that a few days ago, the FBR claimed that to fix fair market value of immovable properties, it had revised upward the values of residential and commercial immovable properties located in 40 major cities across the country from December 1, 2021.
It may also be mentioned here that although the Senate committee can give recommendations to the FBR, as it usually does, the government is not obliged to follow its directions or recommendations.