Punjab introduces new property tax formula

RAWALPINDI:

The Punjab Excise, Taxation and Narcotics Control Department (PETSCD) has approved the implementation of "tax amount" for property tax based on the official price fixed by the Deputy Commissioners (DCs) for the purchase and sale of all types of property across the province under the new tax formula.

Now commercial and domestic property tax will be finalised as per the Deputy Commissioner (DC) rate. This formula will be applicable from January 1, 2025. Property taxes will be issued as per the department's own assessment value till December 31, 2024.

The new formula will benefit the department in property taxes of residential areas in all districts, while there will be a record reduction in tax revenue and tax rate in the taxes of all commercial areas. This is because each commercial area has its own market value, whereas, the DC value is 20 to 40% lower than the market value.

Sources in PETNCD said that there is a risk of a reduction in the property tax target due to this new property tax formula. The commercial property tax payment rate is up to 90% and the domestic rate decreases every year, they added.

All property tax Inspectors have been instructed to achieve the tax target by December 31 in any case. The taxpayer, who doesn't pay property tax by the deadline of December 31, will be sent property tax under the new formula from January 1, 2025.