PHC abolishes tax on immovable property

PESHAWAR: The Peshawar High Court (PHC) has declared null and void the imposition of five percent tax on immovable property.

A two-member bench comprising Justice Abdul Shakoor and Justice Arshad Ali issued a 31-page verdict on the writ petition of Muttahida Property Dealers Association.

The counsels of petitioners had told the court that prices of land properties had gone through the roof after the federal government imposed the five percent tax on transfer of land. They said this had adversely affected the business of property dealers as they were required to pay five percent income tax as per the market value of immovable property. They said the federal government had imposed the tax under the Financial Act 2022 to discourage investment in the real estate sector.

The lawyers told the court that after the 18th Amendment, the federal government could not impose tax on the real estate sector in the provinces and the provincial government was supposed to do so. After hearing the arguments, the court declared the imposition of tax on immovable property as null and void.

Arbab Khalid, Latif Hakim and others had filed the petition. A group of lawyers, including Asim Khan, Asad Yousafzai, Mohammad Tariq and others, represented the realtors in the court. The deputy attorney general appeared on behalf of the federal government.