07-12-2010, 04:25 PM
KARACHI: The Sindh Board of Revenue has increased valuation rates by 200 per cent per sq yard for properties (houses, plots) in posh areas, 150 per cent for units in upper middle class areas, 100 per cent for units in lower middle class and 50 per cent for units in localities inhibited by the poor segment.
The rates were announced in a new valuation table for properties issued under the Stamp Act, 1899 which has come into effect from July 2, 2010.
For valuation purpose properties have been divided into six categories from A-1 for posh areas like Clifton and Defence to category V1, which covers areas like Surjani Town, Qasba, Metrovile etc. The valuation rates for properties in Clifton and Defence area have been raised by 200 per cent per sq yard, 150 per cent for units in Artillery, Burns Road and Gulshan-e-Iqbal, 100 per cent for units in Gulistan Jauhar, F B Area and North Nazimabad and 50 per cent per sq yard for properties in suburb areas.
In the interior areas of the province the valuation rates for units situated in major towns like Hyderabad, Sukkur, Mirpurkhas, Nawabshah, and Larkana have been raised by 100 per cent, while for smaller towns there is an increase of 50 per cent.
According to the valuation table rate of residential plots lying in A-1 category is Rs14,850 per sq yard, commercial plot Rs34,500 per sq yard, and industrial plots RsRs2,200.
For built-up residential plots the rate is Rs23,100 per sq yard, built up commercial plot Rs41,400 and industrial units Rs386 per sq yard. For a built up flat the rate is Rs2,475 per sq foot for category A-1, while Rs125 for flats lying in the poor category.
Acting Chief Inspector of Stamps Ijaz Qureshi told Dawn on Wednesday that the valuation rates had been revised after four years, but they were still far below the prevailing market rates.
Citing examples, he said, the market value of a 1,000-yard bungalow in Clifton is Rs45-50 million whereas the value of the same house in the new table is Rs23 million.
Similarly, the market value of 400-yard bungalow in Gulshan-e-Iqbal is over Rs10 million but in the table its value has been fixed at Rs3 million. In Korangi the value of a plot of 60-yard is Rs0.7 million against only Rs60,000 fixed in the table.
The owners registering their property on sale or purchase will have to pay stamp duty and other taxes calculated on the minimum value of the unit mentioned in the table.
Ijaz pointed out that the registration of properties had come to a standstill due to high rates of taxes which eroded revenue from stamp duty and other taxes. However, in the new budget stamp duty rate had been cut from 3 per cent to 2 per cent and capital value tax (CVT) from 4 to 2 per cent.
Increase in valuation of properties would be compensated by cut in tax rates, he claimed.
The stamp duty collection declined drastically during last fiscal year due to high rates. The directorate collected only Rs3,072 million against the target of Rs6,000 million in 2009-10.
Meanwhile, United Defence Clifton Estate Agents Association Chairman Raja Mazhar criticised the 200 per cent raise in valuation rates for properties by the Sindh government and said it would badly damage the real estate business.
He said that the Sindh Board of Revenue had been sleeping on the valuation table and issued a new table after five years raising the rates abnormally. He said that the valuation rates should have been increased by 50 per cent this year followed by 10 per cent every year.
The rates were announced in a new valuation table for properties issued under the Stamp Act, 1899 which has come into effect from July 2, 2010.
For valuation purpose properties have been divided into six categories from A-1 for posh areas like Clifton and Defence to category V1, which covers areas like Surjani Town, Qasba, Metrovile etc. The valuation rates for properties in Clifton and Defence area have been raised by 200 per cent per sq yard, 150 per cent for units in Artillery, Burns Road and Gulshan-e-Iqbal, 100 per cent for units in Gulistan Jauhar, F B Area and North Nazimabad and 50 per cent per sq yard for properties in suburb areas.
In the interior areas of the province the valuation rates for units situated in major towns like Hyderabad, Sukkur, Mirpurkhas, Nawabshah, and Larkana have been raised by 100 per cent, while for smaller towns there is an increase of 50 per cent.
According to the valuation table rate of residential plots lying in A-1 category is Rs14,850 per sq yard, commercial plot Rs34,500 per sq yard, and industrial plots RsRs2,200.
For built-up residential plots the rate is Rs23,100 per sq yard, built up commercial plot Rs41,400 and industrial units Rs386 per sq yard. For a built up flat the rate is Rs2,475 per sq foot for category A-1, while Rs125 for flats lying in the poor category.
Acting Chief Inspector of Stamps Ijaz Qureshi told Dawn on Wednesday that the valuation rates had been revised after four years, but they were still far below the prevailing market rates.
Citing examples, he said, the market value of a 1,000-yard bungalow in Clifton is Rs45-50 million whereas the value of the same house in the new table is Rs23 million.
Similarly, the market value of 400-yard bungalow in Gulshan-e-Iqbal is over Rs10 million but in the table its value has been fixed at Rs3 million. In Korangi the value of a plot of 60-yard is Rs0.7 million against only Rs60,000 fixed in the table.
The owners registering their property on sale or purchase will have to pay stamp duty and other taxes calculated on the minimum value of the unit mentioned in the table.
Ijaz pointed out that the registration of properties had come to a standstill due to high rates of taxes which eroded revenue from stamp duty and other taxes. However, in the new budget stamp duty rate had been cut from 3 per cent to 2 per cent and capital value tax (CVT) from 4 to 2 per cent.
Increase in valuation of properties would be compensated by cut in tax rates, he claimed.
The stamp duty collection declined drastically during last fiscal year due to high rates. The directorate collected only Rs3,072 million against the target of Rs6,000 million in 2009-10.
Meanwhile, United Defence Clifton Estate Agents Association Chairman Raja Mazhar criticised the 200 per cent raise in valuation rates for properties by the Sindh government and said it would badly damage the real estate business.
He said that the Sindh Board of Revenue had been sleeping on the valuation table and issued a new table after five years raising the rates abnormally. He said that the valuation rates should have been increased by 50 per cent this year followed by 10 per cent every year.