FBR refuses to ease property purchase restrictions

The Federal Board of Revenue (FBR) has turned down the Association of Builders and Developers (ABAD)’s recommendations to ease the restrictions on the purchase of properties following a meeting of the National Assembly’s Standing Committee on Finance. During a meeting chaired by Bilal Azhar Kiani, a member of the ruling Pakistan Muslim League-Nawaz (PML-N), FBR officials established that the provision for examining property acquisitions over Rs10 million cannot be exempted. The officials said that tax filers would still have to declare their sources of income on the new wealth statement and that changes to property valuation for tax purposes such as including gold, stocks, bonds or received properties are not allowed by the current laws. In the meeting, ABAD recommended that there should be no inquiries for properties up to Rs25 million and the first house up to Rs50 million. They complained that the new rules put in place by the FBR could be causing investment to leave the country. However, the FBR officials argued that property purchases will be recorded under the NTN at the time of purchase of the property, and the registrar will ensure that the new property is captured in the system. Thereafter, the buyers will confirm the property entry through their accounts. Kiani advised that it was necessary to make the property purchasing process easier. He also recommended changes to the tax laws to capture the spouse, children, and dependents, to define the cash and cash equivalents, and to permit modifications of the wealth statements. The subcommittee also advised the FBR chairman to submit a new draft of the tax amendment recommendations for further consideration.