ISLAMABAD: Federal Tax Ombudsman (FTO) has directed the Federal Board of Revenue (FBR) that the housing schemes in posh areas must be valued on real time basis to implement accurate valuation tables of immovable properties.
This policy directive on the real estate sector has been issued by the FTO to the FBR on the issue of valuation on immovable properties on Thursday.
The FBR has received the directions from the FTO that the valuation table must include the cost of built-up structure. The housing schemes in posh areas may be valued on real time basis.
For example, the rates proposed by the RTO, Multan have been found defective/ deficient with regard to under valuation of properties viz-a-viz prevailing market rates. Clear demarcation of residential / commercial/ agricultural properties is missing.
Certain residential schemes announced by real estate developers have not been included in the valuation table. This fact has been admitted by the RTO as well and the RTO has committed to take care of these deficiencies in the next valuation table to be proposed to the FBR for its notification.
Own Motion investigation was initiated by FTO Secretariat, Islamabad under Section 9(1) of the FTO Ordinance, 2000 on discrepancies and deficiencies in SRO 1267(1)12022 dated 01.08.2022 being lopsided and deficient and consequently creating hurdles in transparent, across the board smooth implementation of tax laws in the real estate sector.
Apart from considerable loss of revenue, FBR’s inattention and ineptitude on this account leave the field wide open to the whims & wishes of provincial and FBR’s field staff.
The current valuation process of immoveable properties is being carried out by the tax functionaries under the agenda of taxation reform namely Pakistan Raises Revenue Projects (PRRO) on the instructions of World Bank to develop uniform valuation table of immovable properties. It is an ongoing process and is to be revisited periodically by the respective RTOs.
Board notified SRO 334(1)12022 dated 2nd March 2022 on the basis of recommendations made by the respective RTOs.
The FBR should ensure that the FBR Policy Wing (IR), FBR, Islamabad and CCIR, RTO, Multan to revisit the valuation tables to remove the deficiencies/inconsistencies pointed out as has been committed by RTO, Multan.
Copyright Business Recorder, 2023