The Federal Board of Revenue (FBR) has taken cognizance of a number of complaints it received from various stakeholders including real estate agents and town developers from across the country after it notified property valuation rates for 40 cities on December 1, 2021. FBR has issued detailed instructions through an Office Memorandum on the procedure to be adopted to review the anomalies in the property rates and rationalize the same.

FBR has decided to revisit the notified valuation tables wherever overvaluation or undervaluation is pointed out by stakeholders.

According to the instructions, all Chief Commissioners Inland Revenue (CCIRs) would constitute Valuation Review Committees (VRCs), and notify them by December 10, 2021. Any stakeholder having any reservations about valuations may lodge a representation before VRC by December 15, 2021. The Chief Commissioners will undertake a meaningful consultative process with the stakeholders and engage SBP’s approved valuers for the determination of values, which could be either more or less than the lately notified valuations.

It is pertinent to mention that FBR is empowered to determine the fair market value of immovable properties in terms of section 68(4) of the Income Tax Ordinance, 2001. Therefore, FBR vide SRO No.1534-1572(I)/2021 issued new valuation tables of properties across 40 major cities with a view to bringing them closer to the actual market prices.

However, certain objections from various stakeholders including real estate agents and housing societies have been received highlighting anomalies and aberrations in the newly notified valuation tables. Although, the notified valuations have been arrived at by FBR Field Formations through a rigorous consultative process and have largely been well-received, yet the possibility of error cannot be ruled out, and the same cannot be taken as carved in stone.

As per the Office Memorandum, the VRCs shall decide upon the representations by January 10, 2022, and forward the same to FBR for notification. All recommendations made by VRCs vis-à-vis revaluations shall be re-notified on January 15, 2022, which shall come into force on January 16, 2022. In the meantime, SRO No.1534-1572(I)/2021 is held in abeyance to allow registration of the in-process transactions.

Source: Pro Pakistani