ISLAMABAD: The real estate sector has urged the Federal Board of Revenue (FBR) to explain whether the rationale behind the proposed enhancement in values of immovable properties is documentation or merely increasing revenue collection in 2021-22.
In this connection, Muhammad Ahsan Malik, general secretary, Real Estate Consultants Association (RECA) DHA Islamabad-Rawalpindi, has written a letter to the FBR. According to the association, the RECA DHA Islamabad-Rawalpindi is the leading Real Estate Association in Pakistan.
Recently, the RECA has resolved the issue of the DNFBP's between the government and the realtors on August 17, 2021. Now the industry has some serious concerns on enhancement of the FBR Valuation Table at this point of time because during last FBR values enhancement in 2019, it was decided that 10 percent enhancement would be made every year.
Now, the industry wants to know about the intentions of the FBR as whether they are interested to increase the revenue or they want to document the undocumented economy. It is suggested that instead of increasing the FBR Rates at the end of year 2021, it is suggested that this exercise may be carried out in the coming financial year like DC rates.
This will not disturb the positive prevailing market sentiment, which was generated by the concerted joint effort of the present government and the RECA DHA Islamabad-Rawalpindi. The FBR should consult the local Real Estate Associations for every area, while carrying out any updation/revision of the FBR rates.
Moreover, the real estate is the solitary sector through which foreign remittances and local revenue generation has increased manifold. In case, the FBR is bent upon enhancing the FBR rates allover Pakistan, it is suggested that Section37 should be abolished outrightly, otherwise, special waiver should be given in the first two years in Section37.
The advance tax collected at source under Section236K should be reduced and the gain tax collected under Section236C should also be brought down. Special incentives should be announced for registered DNFBP's realtors (as promised), Muhammad Ahsan Malik added.
Copyright Business Recorder, 2021