The Federal Board of Revenue (FBR) and the real estate sector have yet not developed consensus on fair market value of immovable properties in the three main cities of the country, ie, Karachi, Lahore and Islamabad and next round of talks would be held today. Sources told Business Recorder here on Thursday that there is a deadlock on the issues of property valuation in Karachi, Lahore and Islamabad.
The representatives of the real estate sector presented very low values of properties in Karachi, Lahore and Islamabad as compared to the working of the FBR valuers’ team.
In case of the remaining cities, the FBR has agreed with the market rates provided by the real estate sector. The FBR has noted that there is a difference of 25 to 150 percent in values of properties in Karachi, Lahore and Islamabad submitted by the real estate sector when compared with FBR values.
The government team led by Haroon Akhtar, Special Assistant to the Prime Minister on Revenue, held a meeting with the real estate industry here on Thursday to discuss the list of current property prices in 18 cities of the country.
On the conclusion of meeting, FBR Chairman Nisar Muhammad Khan told media that the talks are underway in a positive direction and it is expected that the rates would be mutually finalised in the next 2 days.
The present government has taken the initiative to work out the fair market values of immovable properties. The issue lingering for decades cannot be resolved in haste and we are confident about the positive outcome of the ongoing meetings.
He dispelled the impression that the DC rates are illegal saying that the DC rates are legal which remained applicable in the past at provincial level.
Sources said that there is no issue with the current market rates in most of the list but the property prices in Karachi, Lahore and Islamabad do not match with the market survey/analysis conducted by the FBR.
They added that a six member subcommittee consisting of real estate agents one each from Lahore, Peshawar, Quetta, Islamabad and two from Karachi were meeting with the FBR officials Thursday evening to discuss the rates determined by the FBR and the ones provide by them.
Another meeting of the 13 member committee of the said industry is scheduled to be held on Friday to further the matter. It is expected Finance Minister Senator Ishaq Dar would attend the meeting.
The meeting is scheduled to be held after the Friday prayers and it will give ample time to the real estate sector and the FBR officials to chalk out a middle path agreeable to all sides, sources said.
The 13-member committee is led by president FPCCI Rauf Alam and it includes Association of Builders and Developers (ABAD) the main body of property developers and the associations of real estate agents.
Our main concern is that if there is instability in the real estate market the sale and purchase of properties will suffer – which will eventually lead to a business loss to the builders and developers, representative of industry said.
He added that we do not want to devoid the government of rightful taxes too so this matter should be resolved at the earliest.
One member of realty industry said that after the property rates are settled they would take up the matter related to rate of Capital Gains Tax and the Withholding Tax on sale and purchase of property. -Business Recorder