Islamabad: According to information made public on August 6th, the Federal Board of Revenue (FBR) recently ordered a temporary halt to the anticipated increase in the valuation of immovable assets until September 2023.
FBR Chairman Amjad Zubair Tiwana and a group of tax authorities met with real estate industry members at FBR office. After careful discussion, both parties agreed to postpone the introduction of the increased property values until September 2023. FBR was implementing revised property values this month when this decision was made.
Local committees will be formed in each city as part of the new strategy to determine new property valuations jointly. At the same time, collaborating with real estate associations. The board will confirm a uniform 10% rise in property values for all immovable assets in September 2023.
The board will also introduce the revised “IRIS” system with an online component. This tool allows citizens to submit Section 7E applications for exemptions or 1% tax payments on immovable assets without consulting the Commissioner of Internal Revenue (FBR). This action intends to do away with the Commissioners of Inland Revenue’s discretion in cases about Section 7E of the Income Tax Ordinance 2001.
Citizens must disclose 5% of the fair market value of their domestic capital assets. As income under the new Section 7E of the ordinance. It was implemented as part of the Finance Act of 2022. This revenue is consequently subject to a 20% tax rate, effectively equaling 1% of the property’s value. The FBR recognises difficulties in implementing this new clause. They guarantee that the Commissioner of Inland Revenue won’t abuse his or her authority when issuing exemptions.