Committee formed to revise property tax in SindhArchive
KARACHI: The Sindh government has set up a committee to revise property tax rates by upgrading the valuation table designed in 2001.
The new property tax rate formula to be evolved by the committee will take into account the increase in annual rental value (ARV) of residential and commercial units in Karachi as well as in the interior Sindh.
According to real estate experts, the property tax rates would be double as a result of the revision exercise initiated by the Excise and Taxation department of the provincial government.
The terms and reference of the committee is to rationalise the existing valuation table within a month for determination of ARV of properties at par with fair market rental values.
It will also devise a pro forma for collection of the requisite information/data for the purpose of door- to-door survey of properties which will begin from Sukkur.
The committee will also assist a private survey firm to be assigned the task of enumeration of property units under the World Bank Tax reform project. The survey will also cover small businesses and companies paying professional tax, whose rates fixed over a decade ago are likely to be increased.
Director General of Excise and Taxation Shoaib Siddiqui said the survey would help in determining the prevalent ARV of properties regarding values fixed in 2001 after the last survey. There has been a major change upward in values since then, he added.
According to the existing valuation table, Karachi has been divided in four broad divisions to determine annual rental value. Clifton, Defence and other posh localities fall in ‘A’ division; Tariq Road, Bahadurabad and Sindhi Muslim Housing Society in ‘B’; Gulshan-i-Iqbal, Gulistan-i-Jauhar, North Nazimabad and F.B. Area in ‘C’; while localities such as New Karachi, Liaquatabad, Surjani, etc are in ‘D’ category.
The tax rate for posh residential areas is Rs0.50 per square yard for plot size and covered area both, Rs0.40 per sq yard for higher middle-class areas and Rs0.30 and Rs0.20 per sq yard for middle-class and poor localities, respectively.
For katchi abadis, the tax rate ranges between Rs0.25 and Rs0.10 sq yard for regularised and non-regularised abadis, respectively.
Rates for commercial buildings in posh areas is Rs5 per sq yard of plot size and covered area, Rs4 for higher middle-class areas, Rs3 for middle-class areas and Rs2.50 for low-income localities.
Educational institutions, hospitals, entertainment places, cinemas, sport complex, petrol pumps and marriage halls also fall under the ambit of property tax.
Published in Dawn, April 12th, 2015
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