Higher Property Taxes from July 2024

The Federal Board of Revenue (FBR), in collaboration with provinces, has taken several key steps to improve tax collection through the “Pakistan Raises Revenues” initiative. Here’s a breakdown of the changes:

Revised Property Valuation:

  • Agreements reached with all provinces to standardize immovable property valuation.
  • New valuation tables implemented from July 1, 2024, leading to potentially higher tax revenue from property transactions.

World Bank Loan Adjustments:

  • Disbursement of a $400 million loan from the World Bank linked to achieving specific tax collection targets.
  • Revised goals include raising the tax-to-GDP ratio from 8.5% to 8.8% by FY25.
  • Implementing digital data-sharing across provinces for a unified taxpayer database.
  • Expanding the evaluation period for “Pakistan Raises Revenues” project to June 2025.
  • Focusing on faster customs clearance by measuring goods declaration processing within 48 hours.

Improved GST Efficiency:

  • Agreements between FBR and provinces on input adjustments and digital data-sharing to ensure accurate GST collection.
  • Harmonization of GST and GST on Services (GSTS) for smoother taxation.
  • FBR to prepare MoUs on GST input adjustments with provincial endorsement.
  • Both internal and World Bank reviews of agreements to ensure compliance and effectiveness.

Overall Impact:

These measures aim to enhance tax collection efficiency, leading to more government revenue and potentially impacting property transactions and GST regulations across Pakistan.

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