FBR jacks up property valuation rates by 25 to 250 pc

ISLAMABAD: The Federal Board of Revenue (FBR) on Thursday revised valuation rates of immovable properties in 40 major cities of the country in comparison with earlier notified rates which were done on December 1, 2021.

In the last valuation of property rates, the FBR had jacked up valuation by 600 to 700 per cent depending on areas of respective cities but it could not implement the new rates. Now the valuation rates including commercial, residential, apartments, flats, and other areas of 40 major cities have been again revised and on average, the revised range of valuation of the property stood at between 25 per cent to 250 per cent. However, in certain areas of Lahore, the FBR jacked up notified rates by 400 per cent in accordance with the revised notification with effect from March 2, 2022. In Karachi, there is one area where the valuation rate of the property was increased manifold. The coverage of the valuation of the property was increased from 20 to 40 cities.

The valuation table was notified separately for the first time during the PMLN led regime when it was fixed at 20 to 25 per cent of market rates. The second time, it was revised again during the PMLN tenure. In December 2021 the valuation rate was revised upwards massively, but now it has been revised downwards.

Under the World Bank (WB) loan condition for securing $400 million for Pakistan Raises Revenues (PRR), the FBR increased valuation rates to bring it in line with the market rates. There are three different rates of properties including DC notified rates, FBR’s valuation rate, and market rates. When the FBR had notified valuation rates of properties on December 1, 2021, real estate tycoons and real estate agents raised a hue and cry and demanded the government revise them downwards. The Real Estate Consultants Association (RECA) representatives held meetings with Minister for Finance Shaukat Tarin and convinced him to revise downwards the valuation rates. Following the meetings, the FBR Chief Commissioners of respective cities were assigned to hold consultations and the rates were revised downwards.

The valuation tables have been revised to collect more taxes from the property sector. The FBR has increased the valuation rates of selected 40 cities manifold. The FBR has notified valuation tables for Abbottabad, Attock, Bahawalpur, Bahawalnagar, Chakwal, Dera Ismail Khan, DG Khan, Faisalabad, Ghotki, Gujranwala, Gujrat, Gwadar, Hafizabad, Hyderabad, Islamabad, Jhang, Jhelum, Karachi, Kasur, Khushab, Lahore, Larkana, Lasbella, Mandi Bhauddin, Manshera, Mardan, Mirpurkhas, Multan, Nankana, Narowal, Peshawar, Quetta, Rahim Yar Khan, Rawalpindi, Sahiwal, Sargodha, Sheikhupura, Sialkot, Sukkur and Toba Tek Singh.

In the case of Islamabad, the valuation rate for E-7 was revised downward to Rs 150,000 for any size against the earlier rate of Rs 250,000 per square yard, F-6 rate was fixed at Rs 140,000 for any size from the earlier notified rate of Rs 200,000 per square yard, F-7 rate was fixed at Rs 140,000 for any size against earlier notified rate of Rs 350,000 per square yard, E-11/3-4 was fixed at Rs 70,000 for any size against Rs 110,000 per square yard, B-17 (without possession) any size Rs 12,000 against earlier notified rate of Rs 55,000 per square yard, D-12 Rs 100,000 for any size against Rs 100,000 per square yard, F-8 rate was fixed at Rs 130,000 for any size against Rs 200,000 per square yard. The rate of Bani Gala was fixed at Rs 28,000 for any size of a plot against the earlier notified rate of Rs 36,363 per square yard. It fixed Rs 115,000 for any size in F-10, Rs 110,000 for F-11, Rs 18000 for F-15 in case of possession, Faisal Town Rs 15000, G-17 Supreme Court Housing Society Rs 20,000, Bahria Town from phase 1 to 6 Rs 34,000 for any size, Pakistan Town Rs 18,000,

In Islamabad, the value of residential and commercial superstructure shall be – (a) Rs.2000 per square foot if the superstructure is up to five years old and (b) Rs.1000 per square foot if the superstructure is more than five years old. For the commercial area in Islamabad’s Blue Area on Jinnah Avenue, the value of the shop was fixed at Rs 48,611 per square yard, for the shop located on Fazal-e-Haq Road Rs 45139 per square yard, Melody Market shop on the ground floor Rs 30,556 per square yard, Aabpara market Rs 30,556 per square yard.

In case of Karachi, the FBR has divided all areas into different categories and explained that values in the Tables are in rupees; (ii) Value is per square yard of the covered area of ground floor plus covered area for the additional floors; (iii) Commercial property built up value is per square yard of the covered area of the ground floor plus covered area of the additional floors, if any; (iv) Built up industrial property value is per square yard of the entire plot area plus covered area of the plot per square foot; (v) Value in respect of a residential building consisting of more than one storey shall be increased by 25% for each additional story i.e. value of each storey other than ground floor shall be calculated @25% of the value of the ground floor; (vi) A property which does not appear to fall in any of the categories shown in the Appendix below shall be deemed to fall in the adjacent lowest category of the Appendix; (vii) Whether the land has been granted for more than one purpose viz. residential, commercial and industrial, the valuation in such a case shall be the mean/average prescribed rate; (viii) A flat means the covered residential tenement having separate property nit number/sub-property unit number; (ix) In residential, multi storey building, additional storey shall be charged if it consists of bed room and bath room; (x)

The rates for basements of built-in commercial property in categories I, II and IV shall be Rs. 13,500 per square yard; and (xi) High Rises at Serial Number No. 44 of Appendix means a building with storeys above ground plus five. (xii) The value of the residential built-up property (including the basement and first floor) is allowed to be reduced according to criteria as up to 5 years age of structure of building no reduction is allowed, from 5 to 10 years, 5 per cent reduction will be allowed, from 10 to 15 years, 7.5 per cent reduction is allowed, 15 to 20 years, 10 per cent reduction is allowed and more than 20 years the rate of the open plot will be applied.

In Rawalpindi, the valuation of property in Satellite Town is fixed at Rs 2.4 million in a residential area and Rs 5 million in a commercial area, DHA-1 Rs 740,000 per marla and Rs 4.4 million for commercial area, DHA Valley Rs 125,000 per marla in a residential area and Rs 575,000 per marla in a commercial area, Bank Road Murree Rs 2.9 million for residential area and Rs 5 million for commercial area, Lalazar Wah Rs 1.3 million for residential area and Rs 2.1 million for commercial area, Aslam Market Wah Rs 1.6 million for residential area and Rs 2.3 million for commercial area, Mumtaz City Rs 849,600 per marla for residential area and Rs 7.9 million for commercial area.

In Gawadar city, the valuation of property has been fixed at Rs 17.7 million per acre at Airport Road land, Coastal Highway Washendor Rs 4.9 million per acres and SHS Commercial Rs 16.318 million per acres.

The representatives of Real Estate Consultants Associations, Sardar Tahir and Ahsan Malik told this scribe that the FBR notified valuation rates with this understanding that these rates would remain applicable for the next financial year 2022-23 as recommended by the Senate Standing Committee on Finance and Revenues. They said that there were still some anomalies in rates notified in certain parts of Lahore and Sialkot that were higher than market rates so they appealed to the FBR to revise their rates downwards.

Click here for the FBR's evaluation rates for immovable properties.