Property tax collection misses the mark

Excise and Taxation Dept was expected to bag Rs5b in first half of current fiscal year

LAHORE:

Tax targets not being met has become commonplace in the country with the latest collection falling short of the projected earnings being property tax.

The Excise and Taxation Department of the country’s most populous province, estimated earnings of Rs5 billion rupees in the first half of the current fiscal year but only managed to collect Rs4 billion. Sources indicate that this is due to the ambiguity surrounding the increase in property tax rate.

As per details available with The Express Tribune, at the beginning of the current financial year the Resource Mobilization Committee (RMC) had abolished remission, after which the Excise Department had issued property tax challans with an increase of up to 100 per cent as compared to last financial year. A move which was strongly opposed by the public which in turn piqued the Chief Minister’s interest who directed the RMC to reconsider its decision.

Punjab’s Excise Minister Hafiz Mumtaz, while talking to The Express Tribune, reflecting on the situation, said that they took the public’s outcry seriously. “We are aware that the government’s decision to abolish remittance of property tax and the subsequent challans issued by the department upset the public,” Mumtaz said.

Read Punjab startled by unprecedented property taxes

Presently, the RMC, headed by the Finance Minister, will make final recommendations in its upcoming meeting regarding the increase in property tax. Reliable sources informed The Express Tribune that a proposal to increase the tax by 10 to 20 per cent will be considered and it is likely that a final recommendation of a 15 percent increase will be sent to cabinet.

However, the entire excise department is facing the after-effects of not meeting targets as a reshuffle is on the cards. According to sources, senior officer of the excise department and acting Director General (DG), Rizwan Akram Sherwani, is likely to be appointed as permanent DG Excise for the timely completion of important projects like the new property tax survey in the excise department, highway property tax survey, and other technological innovations being implemented by the department such as online registration for tax purposes.

With the public already feeling the financial strain of inflation, they want a quick resolution for the matter. “The government has already decided to reconsider the decision in the public interest and in the next few days new challans will be issued to more than 1.9 million property taxpayers of Punjab after the approval of the tax increase,” Ahmed informed The Express Tribune.

Published in The Express Tribune, October 7^th, 2021.