In the Punjab Budget 2004-05, houses measuring up to 5 marlas in certain areas, used for residential purposes, have been exempted from the levy of property tax, while stamp duty on Memorandum and Articles of Association of Companies has been abolished.
According to the Finance Bill 2004, only 5-marla houses falling under Category D to G of the Valuation Tables already notified by E&T Department would be given the exemption and it would be effective from July 1.
Punjab Finance Minister Sardar Husnain Bahadar Dreshak said before the Punjab Assembly on Thursday that this property tax relief would provide much needed relief to the low-income groups. The exemption would cost the government Rs 100 million.
The Bill has also proposed abolishment of stamp duty on Memorandum and Articles of Association of Companies, which at present, stands at Rs 1,000 per document.
The finance minister has termed this decision a positive step, as it would encourage establishment of new businesses in the province apart from boosting economic activity and ensuring availability of jobs.
Moreover, the Bill 2004 also proposed reduction in stamp duty to facilitate the housing sector as well as prescribing a uniform rate of transactions in rural and urban areas. It has been proposed that the stamp duty be reduced to the rate of 2 percent from the existing rate ranging from 3 percent to 5 percent on conveyance, exchange of property and gift and all related documents to provide relief to the construction industry and housing sector.
Stamp duty on agriculture land and rural property has also been slashed from 4 percent to 2 percent. "The uniform rate of transactions in rural and urban areas would remove the biggest impediment in sale and purchase of properties in rural and urban areas and it would also discourage the tendency of sale and purchase of 'benami' property," the finance minister said.
The government has proposed to widen the base of professional tax by including tobacco wholesalers and rationalised it by imposing a uniform rate on doctors and lawyers. Under the Bill, Rs 1,000 professional tax has been proposed for both doctors and lawyers, while Rs 2,000 for the wholesalers. The rate of entertainment duty on admission tickets in cinemas has also been suggested to reduce from 30 percent to 15 percent at fixed charge per day for providing further relief to the film industry.
Meanwhile, the lifetime token tax for motorcycles/scooters has been proposed to be enhanced from Rs 1,000 to Rs 1,200 and Rs 1,200 to Rs 1,500. The rates of transfer fee, higher purchase agreement fee, fee for issuance of duplicate registration certificate, fee for assignment of fresh registration mark on removal of a motor vehicle from outside Punjab and fee for alteration in various categories of motor vehicles has also been rationalised.
Transfer fee: Under the revised fee, a vehicle owner with engine capacity up to 1000cc would pay Rs 1,200, with engine capacity exceeding 1000cc but not exceeding 1800cc would pay Rs 2,000 and with engine capacity exceeding 1800cc would pay Rs 3,000.
Re-registration and Hire Purchase fees: Rs 150 would be charged for a motorcycle/scooter, Rs 4,000 for a heavy transport vehicle, with engine capacity up to 1000cc would pay Rs 1,200, with engine capacity exceeding 1000cc but not exceeding 1800cc would pay Rs 2,000 and with engine capacity exceeding 1800cc would pay Rs 3,000.
Alteration fee: Rs 3,000 for transport vehicles and Rs 1,500 for other vehicles.
There has also been a nominal increase of Rs 10 in the test of competence fee for HTV, LTV and motor cars.
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