After a considerable gap of nine years, the Punjab caretaker government has finally given its approval for the assessment of property tax across the province.
According to the summary approved by the cabinet, a comprehensive valuation table for property tax will be formulated, taking into account the new rents.
This will be followed by a substantial 400 percent increase in property tax for both commercial and residential properties falling under the posh areas, commonly categorized as Category A.
Once the survey, working, and calculations regarding the property tax increase are completed, the summary will be forwarded to the cabinet for further approval.
The new valuation table is slated to include categories from A to G, covering a wide range of properties. Interestingly, the cabinet has also greenlit the imposition of property tax on 5-marla houses in posh areas (Category A), which were previously exempted from this taxation.
It’s worth noting that the property tax assessment in Punjab was last conducted back in 2014. According to the relevant law, such assessments are mandated every five years, a requirement that was unfortunately not fulfilled.
During the 2014 property tax assessment, it was established that in Category A areas, the rent for commercial properties was Rs120 per square foot, while the property tax for residential use was a flat rate of Rs24 per square foot.
However, the rent for these commercial properties has now skyrocketed to Rs500 per square foot, forming the basis for the forthcoming property tax assessment.
In terms of timing, the previous valuation table is set to expire on 31st December 2023. Consequently, the new assessment must be enforced starting from 1st January 2024, taking into consideration the existing rents.
In addition to the property tax adjustments, the cabinet has also given the green light for several other measures. These include the introduction of a token tax of Rs2,500 per seat on vehicles with seven or more seats.
Moreover, there will be an additional 3 percent duty on the booking of vehicles ranging from 1,500 to 2,000cc, while electric vehicles will receive a 95 percent exemption from token tax, which will be extended until June 30, 2025.
Furthermore, the steelhead duty on liquor has been increased from Rs600 to Rs1,200 per gallon, and the vendor fee has been raised from Rs1,600 to Rs2,500 per gallon.
With these measures now approved, the Punjab government aims to streamline the property tax system and generate additional revenue for public welfare initiatives.
However, these changes have sparked discussions and debates among stakeholders, with some expressing concerns over their potential impact on different segments of society.
Source: Pro Pakistani