LAHORE: The Punjab caretaker government has given the green light to assess property tax rates across the province, marking the first evaluation in 9 years.
According to the approved summary by the cabinet, a new valuation table for property tax will be established, where the tax amount will be determined based on the newly set rental values.
As part of the measure, a substantial 400 percent increase in property tax will be imposed on both commercial and residential properties located in affluent areas, categorized as category A.
Following the survey, calculation, and working on the revised property tax rates, the proposal will be presented to the cabinet for final approval.
Sources reveal that the new valuation table will span from Category A to Category G.
Additionally, the cabinet has sanctioned the application of property tax on even 5-marla houses located in upscale areas (Category A), which were previously exempted from property tax.
Notably, the last property tax assessment in Punjab took place in 2014.
According to the law, property tax assessments should occur every five years, a requirement neglected in the past.
In the 2014 property tax assessment, commercial properties in category A areas were valued at Rs. 120 per square foot for rent, while personal use properties were taxed at a flat rate of Rs. 24 per square foot.
However, the current rental rates for these commercial properties have surged to Rs. 500 per square foot, which will now serve as the basis for their property tax assessment.
The consolidation plan stipulates that the previous valuation table will expire on December 31, 2023, and the new assessment will be implemented from January 1, 2024, based on the prevailing rental values.
Apart from property tax changes, the cabinet has also approved a token tax of Rs. 2,500 per seat for vehicles with 7 or more seats.
Additionally, a 3 percent tax (minimum 2 percent) will be levied on the booking of vehicles ranging from 1,500 to 2,000cc.
Moreover, electric vehicles will face a tax upon registration, while a 95 percent exemption from token tax has been extended until June 30, 2025.
Source: The News
