Govt moves to abolish structure tax

'Property transactions at standstill due to levy'

PESHAWAR:

A committee formed to address property taxes in Peshawar has recommended the abolition of the structure tax on buildings.

This decision is expected to bring significant relief to the residents of Peshawar. The committee has finalised its recommendations, which will be forwarded to the Chief Minister for approval.

The structure tax was imposed in 2016 by the then deputy commissioner of Peshawar. Due to its high rates, the process of property transfers in Peshawar came to a standstill.

In response, PTI leaders approached the chief minister, who formed a committee headed by Senior Member Board of Revenue (SMBR). The committee included former Nazim Gulzada, Muhammad Ali Arbab, Haji Saeed, and the Peshawar DC.

As per reports, the committee reviewed the structure tax and deemed it illegal. It was revealed that the tax was implemented under the Stamp Act of 1899 with the intervention of the FBR.

The committee was provided with details of revenue before and after the tax's imposition. Before 2016, Peshawar generated approximately PKR620 million from property transfers, but this figure dropped to PKR60 million after the implementation of the structure tax.

The committee's report stated that the tax was only enforced within municipal or metropolitan limits, excluding areas under the Peshawar Development Authority (PDA). Additionally, following its introduction in Peshawar, the structure tax was also imposed in Mardan and Nowshera.

The committee has recommended to the Chief Minister that the structure tax be abolished and that Peshawar be granted a six-month exemption from the deputy commissioner's rate to facilitate property transactions.

The structure tax in Peshawar is a local tax levied by the Khyber-Pakhtunkhwa government, specifically the Peshawar Development Authority (PDA) or local municipal authorities, to generate revenue for the development and maintenance of urban infrastructure.

The tax is imposed on owners of buildings, including residential, commercial, and industrial properties, based on the size, location, and type of construction.

Its primary purpose is to fund essential services such as road development, sanitation, public health, and other civic amenities.

The structure tax in Peshawar operates within the framework of the K-P Local Government Act, which gives municipalities the authority to impose and collect taxes for local governance purposes. The tax is assessed based on the area of the property, the number of floors, and the building's use.