Facing the music: Property tax defaulters’ buildings to be sealed

Excise dept official says defaulters were given notices

PESHAWAR: The Excise Taxation and Narcotics Control department has planned to seal buildings of around 500 property tax defaulters, including transport companies, hotels, education institutions and commercial and residential buildings in Peshawar.

“We have identified 500 major defaulters and the amount they have not yet paid ranges between Rs0.3 million to Rs13 million,” Sufyan Haqqani, assistant collector, told The Express Tribune. “We have completed all work in this regard.”

The official informed that the owner of Peshawar terminal of Daewoo Express was their major defaulter since he was supposed to pay a property tax of Rs13 million to the government exchequer. “Other defaulters include City University of Science and Information Technology, several Wapda grid stations and offices and a number of other commercial and non-commercial buildings.”

Haqqani added they have informed the DC’s office about their operation that will commence soon, in order to recover unpaid property taxes. “We will seal five buildings of tax defaulters every day.”

For the defaulters

He said they had notified all the defaulters to pay their taxes on time. “Initially, we sent a PT-10 (notice for property tax) to the defaulters under Urban Immovable Property Act 1958 of the Excise and Taxation Manual to ask for the submission of taxes.” However, he added, when the person in question did not respond to the PT-10, the department issued another notice, PT-11, which is a reminder, and then a final notice. “When the person concerned did not reply to any of these notices, a department official pasted a Dastak on the defaulter’s door; Dastak means the official can raid the place at any time.”

Haqqani said the excise and taxation official (ETO), who mostly supervises such raids, has several legal powers; for instance he can seal the building or arrest the owner. “Through his own power, the ETO can keep a defaulter in a lockup for 14 days, and if the defaulter does not pay the tax even after that, the imprisonment period can be extended to another two weeks.”

The collector added as a final option, the ETO can also auction the property of the defaulter, for not paying property taxes.

“Some of the citizens and businessmen have replied to our notices, but are making excuses and delaying payment.” Haqqani said the defaulters are happier to pay bribes instead of paying taxes.

Category division

“We are charging taxes according to the category of the buildings,” Haqqani said. “The categories are made by the Local Government department; they have divided the buildings into A, B and C categories.”

The official stated all the categories were made in accordance with the facilities available in the area where the buildings were located. “Even the tax rate of residential and commercial buildings is different,” he said, clearing that property tax cannot be imposed on the land; it can only be levied on buildings. “There are around 0.2 million property units in Peshawar, and a large number of them are not paying property tax; hence we have started the initiative.” He said so far the property tax is imposed on buildings that are located in municipal committee limits.

Another official privy to the matter told The Express Tribune the 500 defaulters’ list includes the senior leader of a religious party and a number of MPAs of the provincial assembly.

Published in The Express Tribune, November 6^th, 2015.