Federal Board of Revenue struggles to update property valuations

The Federal Board of Revenue (FBR) has faced challenges in its attempts to include developers and builders, particularly new housing societies, in the tax net. Despite efforts to update property valuations, the desired outcomes have not been achieved. The FBR is set to release revised values of immovable properties starting July 1, 2024, after collaborating with provincial authorities to update valuation tables nationwide.

Since the last valuation in March 2022, property rates have remained unchanged for over two years, hindering the FBR's goal of taxing new housing societies. A temporary suspension on proposed valuation increases was in place until September 2023, following negotiations between the FBR and the real estate sector.

Although committees were formed in various cities to determine new property values in consultation with real estate associations, progress has been stagnant. The Federal Tax Ombudsman emphasized the need for real-time valuations of upscale housing schemes to ensure accurate property assessments.

The lack of uniform standards led to inconsistencies in determining fair market value, prompting the FBR to consider international valuation standards for guidance. Valuers are urged to uphold principles of integrity, objectivity, and professionalism while assessing property values.

As the FBR prepares to announce updated property rates in June 2024, the focus remains on implementing transparent and accurate valuation practices to bring developers and builders under the tax umbrella.