Urban property tax base expansion: WB board approves USD150m for Sindh PREP

ISLAMABAD: The World Bank Group’s Board of Executive Directors has approved USD150 million in financing for the Sindh Property Revenues Enhancement Program (Sindh PREP), under which the provincial government plans to expand the recorded urban property tax base more than fivefold — from around 397,375 to 2.15 million properties — in 20 local councils.

The programme will improve urban property tax collection and strengthen municipal service delivery in Sindh.

“Cities that can raise their own revenues can plan and invest for the long term,” said Bolormaa Amgaabazar, World Bank Country Director for Pakistan. “Today, Sindh’s local councils depend on provincial transfers for more than 95 percent of their revenues. By helping Karachi collect property taxes from its residents and businesses, and by reinvesting most of that revenue in local services, this programme will give Sindh’s cities the means to finance the infrastructure they need.”

READ ALSO: Sindh to expand urban property tax base five-fold to 2.15mn properties

The Sindh PREP will support the government of Sindh in improving urban immovable property tax (UIPT) collection and strengthening municipal service delivery capacity in selected local councils across the province.

Despite being one of the world’s largest cities, Karachi currently collects only approximately USD8.5 million annually in property tax, while cities of similar size collect 82 to 350 times more. The programme aims to increase this amount to USD85 million annually by raising compliance from 20 to 50 percent. It will do so by strengthening UIPT collection, compliance and administration, including through the deployment of a UIPT management information system for billing, payment processing and grievance redress, as well as the rollout of integrated financial management information systems across local councils.

About 70 percent of collected UIPT revenues will be reinvested directly in municipal infrastructure and services in participating local councils.

The programme will benefit Karachi’s 25 local councils. Its primary beneficiaries are the 3.58 million people living in these councils, where service delivery investments will be financed. Funding will be linked to results: annual performance assessments, conducted by an Independent Verification Agent, will determine the allocations each council receives. These allocations will finance the rehabilitation of climate-resilient municipal infrastructure and services, including drainage, sewerage, schools, fire stations, roads and street lighting.

The programme also includes an Investment Project Financing component of USD40 million, which will expand property surveys and UIPT administration to 20 local councils in Sindh’s other urban centres, indirectly benefiting approximately 4.5 million people.

“Karachi has significant untapped potential to generate revenues from its property base and use those resources to fund the infrastructure its residents and businesses need. This programme will help Sindh strengthen fiscal sustainability, enabling cities to plan, invest and deliver services effectively from their own resources,” said Davison Muchadenyika, Senior Urban Development Specialist at the World Bank.

The planned GIS-based, door-to-door survey is expected to increase the recorded property base in 20 participating local councils to approximately 2,149,080 properties, representing a more than five-fold expansion. Survey teams will visit residential and commercial premises, record property attributes and geo-tag properties for entry into a new UIPT Management Information System.

The programme will cover 20 local councils in five divisions outside Karachi — 9 in Hyderabad, 3 in Sukkur, 4 in Larkana, 2 in Mirpurkhas and 2 in Shaheed Benazirabad. The broader institutional strengthening component, however, will extend to all 45 participating local councils, including 25 in Karachi.

Copyright Business Recorder, 2026