Capital Residents to Clear Tax on Property Purchases

Posted by: IIPS Category: Daily Insights Tags: Comments: 0

The Islamabad District Administration has given a seven-day deadline to property buyers who previously defaulted on their taxes on purchase or sale of properties from 2012 to 2020. If the residents who are liable to these taxes pay their dues as planned, the government will be able to collect 2.3 billion PKR in terms of capital value tax, advance tax, and gain tax. The ICT authorities claim that if the property taxes are not submitted on time, the mutations of land will be cancelled, and strict legal action will be taken against the defaulters.

According to the Deputy Commissioner of Islamabad, Hamza Shafqat, the courts have decided to agree with the government’s directive of tax collection from all the property buyers who bought or sold properties between the year 2012 to 2020. Although these taxes were abolished, the pending dues are still to be recovered and the general public who bought or sold property are bound to comply with the directives of the federal government. In addition, local government officials claim that even though the tax law was amended in 2020, many people did not pay their pending dues since 2012.

The collection of pending taxes is an important source of revenue for the government. The government abolished this property tax in 2020 which included sellers to pay one per cent of the total value of the property (2% for non-filers), and buyers to pay 1% CVT, however, the pending dues ranged from 2012-to 2020 remains uncollected.

The land is an important resource and just like any other commodity needs to be effectively regulated. The government needs a strong revenue base to efficiently regulate one of its largest asset classes in the country.

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IMARAT Institute of Policy Studies

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