Rawalpindi’s residents are in for a shock when they apply for transfer and registration of new properties, as the district government has increased taxes on buying and selling of properties, along with the property tax rates on five-marla houses in seven tehsils and the cantonment areas.
The district coordination officer (DCO) and district collector on Tuesday announced a 25 to 27 per cent property tax increase in the district’s residential areas, including Rawalpindi, Gujar Khan, Kallar Syedan, Murree, Taxila, Wah Cantt, Rawal Town and Potohar Town. In addition, a 10 per cent district collector’s rate, two per cent capital value tax, one per cent municipal tax and one per cent stamp duty has also been imposed on residential properties. A 45 per cent increase in taxes on commercial properties in these areas was also announced. The tax increases will be enforced with immediate effect.
Moreover, the government has also levied a tax on properties that have been leased out by individuals to their relatives. Individuals who would previously have bought a single three-marla house for Rs35,000 would now have to pay between Rs75,000-80,000 for the same house after the imposition of these taxes. Those who have already applied and are engaged in the property registration process have been stopped in their tracks and asked to pay 40 to 45 per cent more to buy or sell their properties.
Rawalpindi District Bar Association Secretary Malik Zaheer Arshad and Advocate Faazil Bhatti claimed that the decision was illegal and unconstitutional. They said they would be challenging the decision in the high court. They said that the DCO did not seek feedback and objections from citizens and announced the decision without their consent.
Rawalpindi Union of Stamp Vendors President Malik Waheed Awan also criticised the move and termed it a cruel step that will encourage theft and open new avenues for corruption. Awan demanded an immediate withdrawal of the decision, backed with the threat of a union protest. He said that with the imposition of the new taxes, lower-cadre government employees had been deprived of their right to purchase small houses which were previously affordable for them.
The Punjab government had earlier declared tax exemptions for properties in the Cantonment areas. However, the cantonments have sent a summary to the Defense Ministry seeking the imposition of taxes on houses in the areas.
Published in The Express Tribune, July 10th, 2013.