President of the Karachi Chamber of Commerce and Industry (KCCI) Younus Muhammad Bashir has urged Federal Finance Minister Muhammad Ishaq Dar to withdraw Property Valuation Tables and continue the old system of collector's value.
The provincial and federal governments along with all stakeholders must jointly decide the increase in collector's value which can be raised up to 3 to 5 times according to the location of the property, he said in a communiqué sent to Ishaq Dar. "These rates should be acceptable by both federal and provincial governments for registration, provincial taxes and Capital Gain Tax etc," he added.
Seeking the Finance Minister's attention towards the recent slump being suffered by the real estate and construction sector due to implementation of unrealistic Property Valuation Tables issued by the Federal Board of Revenue (FBR), Younus Bashir pointed out that these tables have been finalised without taking inputs from all the stakeholders. The situation has resulted in creating an extremely disturbing atmosphere which is likely to have a deep impact on some of the key economic indicators of the country, he opined.
President KCCI was of the opinion that it is totally unworkable to have two rates of same property for Provincial and Federal taxation purposes, creating hurdles in accounting procedures, besides paving way for corrupt elements to benefit from the situation.
He said that uncertainty prevails in the entire real estate & construction sector, which has terribly affected the performance of this particular sector during the last couple of months as it has been observed that transactions have hardly taken place during this period and the real estate & construction sector has come under tremendous pressure.
Younus Bashir feared that if situation goes on like this, the effects will soon depict in key economic indicators as dozens of allied industries across Pakistan are likely to suffer.
He further noted that the decisions on these Property Valuation Tables were implemented after consultation with some real estate agents and a committee of the FPCCI only whereas many genuine representatives including Industrial States and major Chambers of the country were not taken on board. "Consequently, after consultation with KCCI, even FPCCI has now rejected the FBR's Property Valuation Tables as these are not workable", he added.
He said that there was absolutely no solution to deal with the situation emerging after the issuance of Property Valuation Tables except withdrawal of the same. The President KCCI hoped that the Finance Minister would issue prompt directives as per the aspirations of the Business and Industrial Community which will help restore the confidence of local and foreign investors of real estate sector which was performing exceptionally well and it also attracted a sizeable amount of foreign investment prior to implementation of Property Valuation Tables.