The Federal Board of Revenue (FBR) announced new valuation tables for taxation of property in July 2019. The new rates will be applicable from July 24, 2019. A notification in this regard was issued on July 23, 2019. Eleven categories have been defined for the properties in Karachi from A-I to X. The category A-I has the highest rate. The revised valuation rates are announced for 20 cities, including Abbottabad, Bahawalpur, Faisalabad, Gujrat, Gwadar, Hyderabad, Islamabad, Jhang, Jhelum, Karachi, Lahore, Mardan, Multan, Peshawar, Quetta, Rawalpindi, Sahiwal, Sargodha, Gujranwala, and Sukkur. It is an initiative of FBR to determine the fair market value of the real estate.
Earlier, the property transactions were made using the Deputy-Commissioner (DC) Rate, and the rate was far below the market value of the property. Now, the valuation rates have been increased on average from 50 percent to 85 percent. In the notification, a flat is defined as follows:
a flat means the covered residential tenement having separate property unit number/sub-property unit number
In the valuation table, the properties have been classified into the following types:
- Residential Open Plot
- Residential Built-up Property
- Commercial Open Plot
- Commercial Built-up Property
- Industrial Open Plot
- Industrial Built-up Property
- Flats/Apartments
The valuation rates for Flats/Apartments and Industrial Built-up Property are defined in per square foot. For the other five types, the rates are set in per square yard. For Karachi and some other cities, there is also a table for area-wise categories for valuation. For the property types of residential, commercial, industrial, and flats, the table describes the specific category number from A-I to X. Consider the case of Firdous Colony Karachi, which is entry number 49 in the table. The residential property for this entry is classified in category II, commercial in category II, industrial in category I, and flats in category III. Hence, minimum rates for flats/apartments in Firdous Colony will be Rs. 1,900 per square foot.
After this revision, the property valuation rates are approximately 85% of the fair market value, according to an FBR Member. The valuation rates of Karachi can be viewed at the following links, and they are also reproduced below:
http://download1.fbr.gov.pk/SROs/20197231971722163Karachi2019-07-23(1).pdf
The valuation rates for all 20 cities can be accessed at the following links: