Valuation of immovable properties: FTO directs FBR to hire competent, experienced valuers

ISLAMABAD: Federal Tax Ombudsman (FTO) has directed the Federal Board of Revenue (FBR) to hire competent and experienced valuers for valuation of immovable properties for transparency and accuracy.

In this regard, the FTO has issued an order in the matter of the valuation of immovable properties in Gwadar.

According to an order issued by the FTO on Friday, the FBR should also constitute standing anomaly committee at appropriate levels to address grievances of the stakeholders on issues of valuation.

Immovable properties: FBR issues guidelines for taxpayers

The FTO has also directed the FBR to develop a standing operating procedure (SOP) containing suitable methods of valuation of immovable properties.

The FTO has also directed the FBR to forthwith functionalize the Directorate General of Immovable Property established under section 230F through Finance Act, 2018 as the same is non-functional since its establishment. This would provide an appropriate framework for proper valuation of immovable properties.

The own motion investigation was initiated by the FTO Secretariat with regard to discrepancies and deficiencies in SRO.1271(I)/2022 being lopsided, flawed and deficient and consequently obstructing transparent, coherent and across the board smooth implementation of tax laws in the real estate sector.

Apart from considerable loss of revenue, FBR’s inattention and ineptitude on this account leave the field wide open to the whims and wishes of provincial and FBR’s field staff.

Earlier, the FTO had directed the Federal Board of Revenue (FBR) to immediately activate the Directorate General of Immovable Property (DGIP) to remove discrepancies/anomalies in FBR’s valuation tables of immoveable properties issued by the FBR Inland Revenue (Policy) Wing.

Sources told Business Recorder that the real estate sector remained a focus of the international donor agencies keeping in view high revenue potential and check manipulation/money laundering in real estate transactions.

In November 2018, a new tax authority DGIP was created, which became dysfunctional in 2019.The work of the DGIP was done by the FBR Policy Wing which committed blunders in SROs of the valuation tables of immoveable properties.

The FBR Policy Wing has not hired any professional valuers but allowed its Secretary Inland Revenue (Policy) to notify defective values as communicated by the field formations.

This resulted in blunders in the SROs issued by the FBR on valuation tables of immoveable properties.

Copyright Business Recorder, 2023