Business community has termed the Federal Board of Revenue's property evaluation tables as unrealistic, demanding of the government to withdraw it immediately. Chairman of the Businessmen Panel and former President of Federation of Pakistan Chambers of Commerce and Industry (FPCCI), Zakria Usman said the new property evaluation mechanism for immovable property has destabilised the real estate market.
"We reject the notification of the FBR issued on August 2 as it has jacked up the prices of industrial plots by 400 to 600 percent, which has ignited the flight of capital." Some opportunists have capitalised on the confusion and increased the prices of residential, commercial and industrial plots to an extent that these have gone beyond the reach of masses, he added.
Finance Minister Ishaq Dar had directed the FBR to take all the chambers and associations into confidence over property laws and amend the same accordingly.....but that didn't happen. Zakria said that allowing the FBR to handle property evaluation has not only troubled masses but also discouraged investors which will ultimately result in corruption. He said the district revenue officers were doing their job to the satisfaction of all stakeholders while the prices could have been revised upward but changing the system is beyond apprehension. He said the business community will accept double value but will not accept the FBR formula which is 'flawed' and has resulted in market slump.
Poor people who were planning to buy homes from their lifetime savings have also been cornered by the government move which is not acceptable, he maintained. President of Karachi Chamber of Commerce & Industry (KCCI), Younus Muhammad Bashir said there was absolutely no solution to deal with issues emerging after the issuance of unrealistic property evaluation tables by FBR. Thus, these evaluation tables must be withdrawn whereas the system of collectors value for registration be accepted for Capital Gain Tax (CGT) as well.
He said it was totally senseless to implement two rates to carry out evaluation of same property for provincial and federal taxation purposes creating hurdles in the accounting procedures besides paving way for corrupt elements to thrive. Younus Bashir said uncertainty prevails in the real estate & construction sector as it has been observed that transactions hardly took place during this period.
If the situation persists, it will hit key economic indicators as dozens of allied industries across Pakistan are likely to suffer badly due to poor decision-making. He said on the special request by the acting President FPCCI and after considering the gravity of the situation, the Karachi Chamber has decided to participate in a meeting at Federation House to only discuss this issue.
"In the larger interest of the country, we feel it necessary to take part in the FPCCI meeting to discuss the issue of property valuation as the real estate sector is terribly suffering due to unwise decisions taken without considering the consequences," he added.
He noted that the valuation tables publicised by the FBR also contained numerous legal flaws. The business community completely rejects these tables and urges the authority to revert to the previous system of property valuation.
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