{"id":16377,"date":"2023-05-18T17:54:21","date_gmt":"2023-05-18T12:54:21","guid":{"rendered":"https:\/\/propakistani.pk\/proproperty\/?p=16377"},"modified":"2023-05-18T17:54:21","modified_gmt":"2023-05-18T12:54:21","slug":"revenue-commission-proposes-reforms-to-combat-real-estate-tax-evasion","status":"publish","type":"post","link":"https:\/\/propakistani.pk\/proproperty\/revenue-commission-proposes-reforms-to-combat-real-estate-tax-evasion\/","title":{"rendered":"Revenue Commission Proposes Reforms to Combat Real Estate Tax Evasion"},"content":{"rendered":"<p>ISLAMABAD: The Revenue Commission has recommended making tax registration mandatory for buyers and sellers of properties and linking capital gains tax exemption to the disclosure of assets at the time of purchase.<\/p>\n<p>This proposal aims to address tax evasion in the real estate sector, which has a significant undocumented economy.<\/p>\n<p>The Reform and Revenue Mobilisation Commission (RRMC), led by Ashfaq Tola, has suggested overhauling the real estate tax system and taxing benami properties when discovered without a time limit.<\/p>\n<p>The Federal Board of Revenue (FBR) is expected to support these recommendations, particularly regarding exempting capital gains tax.<\/p>\n<p>The Tola Commission report highlights the lack of data on larger residential units and immovable properties, indicating a need to enforce tax laws and expand the tax base.<\/p>\n<div style=\"clear:both; margin-top:0em; margin-bottom:1em;\"><a href=\"https:\/\/propakistani.pk\/proproperty\/rcb-to-form-committe-to-resolve-encroachment-and-property-tax-issues\/\" target=\"_blank\" rel=\"dofollow\" class=\"uea82371117d9f9bc278d37d5810f6f3c\"><style> .uea82371117d9f9bc278d37d5810f6f3c { padding:0px; margin: 0; padding-top:1em!important; padding-bottom:1em!important; width:100%; display: block; font-weight:bold; background-color:#2C3E50; border:0!important; border-left:4px solid #F1C40F!important; text-decoration:none; } .uea82371117d9f9bc278d37d5810f6f3c:active, .uea82371117d9f9bc278d37d5810f6f3c:hover { opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; text-decoration:none; } .uea82371117d9f9bc278d37d5810f6f3c { transition: background-color 250ms; webkit-transition: background-color 250ms; opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; } .uea82371117d9f9bc278d37d5810f6f3c .ctaText { font-weight:bold; color:#F1C40F; text-decoration:none; font-size: 16px; } .uea82371117d9f9bc278d37d5810f6f3c .postTitle { color:#eaeaea; text-decoration: underline!important; font-size: 16px; } .uea82371117d9f9bc278d37d5810f6f3c:hover .postTitle { text-decoration: underline!important; } <\/style><div style=\"padding-left:1em; padding-right:1em;\"><span class=\"ctaText\">ALSO READ<\/span>&nbsp; <span class=\"postTitle\">RCB to Form Committe to Resolve Encroachment and Property Tax Issues<\/span><\/div><\/a><\/div>\n<p>The report also suggests issuing compulsory National Tax Numbers (NTNs) to non-filers for specific transactions.<\/p>\n<p>However, despite potential government endorsement, full implementation of the recommendations by the FBR is uncertain, given the current low number of tax filers compared to NTN holders in Pakistan.<\/p>\n<p>The Commission&#8217;s report identifies significant under-reporting of income and property, with a considerable portion of taxpayers not paying taxes according to their returns.<\/p>\n<p>To address tax evasion in the real estate sector, the Commission recommends limiting the capital gains tax exemption to those who declare their properties in their wealth statements during the acquisition year and subsequent years until disposal, with the exemption granted once every three years.<\/p>\n<p>The current law exempts capital gains tax on certain types of properties held for specific periods.<\/p>\n<p>The report notes that some taxpayers only declare properties in their wealth statements after the required holding period to claim tax exemptions.<\/p>\n<div style=\"clear:both; margin-top:0em; margin-bottom:1em;\"><a href=\"https:\/\/propakistani.pk\/proproperty\/248-property-units-sealed-in-crackdown-against-tax-defaulters\/\" target=\"_blank\" rel=\"dofollow\" class=\"u67badbaad3cae26a21bdfd6ee2164dab\"><style> .u67badbaad3cae26a21bdfd6ee2164dab { padding:0px; margin: 0; padding-top:1em!important; padding-bottom:1em!important; width:100%; display: block; font-weight:bold; background-color:#2C3E50; border:0!important; border-left:4px solid #F1C40F!important; text-decoration:none; } .u67badbaad3cae26a21bdfd6ee2164dab:active, .u67badbaad3cae26a21bdfd6ee2164dab:hover { opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; text-decoration:none; } .u67badbaad3cae26a21bdfd6ee2164dab { transition: background-color 250ms; webkit-transition: background-color 250ms; opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; } .u67badbaad3cae26a21bdfd6ee2164dab .ctaText { font-weight:bold; color:#F1C40F; text-decoration:none; font-size: 16px; } .u67badbaad3cae26a21bdfd6ee2164dab .postTitle { color:#eaeaea; text-decoration: underline!important; font-size: 16px; } .u67badbaad3cae26a21bdfd6ee2164dab:hover .postTitle { text-decoration: underline!important; } <\/style><div style=\"padding-left:1em; padding-right:1em;\"><span class=\"ctaText\">ALSO READ<\/span>&nbsp; <span class=\"postTitle\">248 Property Units Sealed in Crackdown Against Tax Defaulters<\/span><\/div><\/a><\/div>\n<p>High levels of tax evasion in the real estate industry are supported by influential individuals and segments in Pakistan.<\/p>\n<p>Adopting the Tola Commission&#8217;s recommendations may assist the FBR in achieving its tax collection target for the upcoming fiscal year.<\/p>\n<p>The government also collects withholding taxes on property transactions based on undervalued property values, leading to significant evasion.<\/p>\n<p>To combat tax evasion related to benami properties, the Commission recommends amending Section 111 of the Income Tax Ordinance.<\/p>\n<p>It proposes taxing all undisclosed benami assets in the year of discovery and applying the statute of limitations from that year.<\/p>\n<p>Currently, foreign assets are taxed in the year of discovery, while a separate law prohibits benami holdings for local assets, but its applicability to assets created before the law&#8217;s enactment is a legal issue. Amending Section 111 would expand the tax base, increase revenue from undisclosed assets, and discourage hiding assets until the statute of limitations expires.<\/p>\n<p>Source: <strong>The Express Tribune<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>ISLAMABAD: The Revenue Commission has recommended making tax registration mandatory for buyers and sellers of properties and linking capital gains tax exemption to the disclosure of assets at the time of purchase. This proposal aims to address tax evasion in the real estate sector, which has a significant undocumented economy. The Reform and Revenue Mobilisation Commission (RRMC), led by Ashfaq Tola, has suggested overhauling the real estate tax system and\u2026<\/p>\n","protected":false},"author":2,"featured_media":1256,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[],"class_list":["post-16377","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"img_urls":{"thumbnail":["https:\/\/propakistani.pk\/proproperty\/wp-content\/uploads\/2022\/07\/property-tax-Singapore-940x627-1.webp",940,627,false],"medium":["https:\/\/propakistani.pk\/proproperty\/wp-content\/uploads\/2022\/07\/property-tax-Singapore-940x627-1.webp",940,627,false],"full":["https:\/\/propakistani.pk\/proproperty\/wp-content\/uploads\/2022\/07\/property-tax-Singapore-940x627-1.webp",940,627,false]},"author_name":"Nazzir Zaidi","categories_name":["News"],"title_text":"Revenue Commission Proposes Reforms to Combat Real Estate Tax Evasion","related_stories":"https:\/\/propakistani.pk\/proproperty\/wp-json\/wp\/v2\/posts?filter&per_page=4&categories=5&exclude=16377","_links":{"self":[{"href":"https:\/\/propakistani.pk\/proproperty\/wp-json\/wp\/v2\/posts\/16377","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/propakistani.pk\/proproperty\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/propakistani.pk\/proproperty\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/propakistani.pk\/proproperty\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/propakistani.pk\/proproperty\/wp-json\/wp\/v2\/comments?post=16377"}],"version-history":[{"count":0,"href":"https:\/\/propakistani.pk\/proproperty\/wp-json\/wp\/v2\/posts\/16377\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/propakistani.pk\/proproperty\/wp-json\/wp\/v2\/media\/1256"}],"wp:attachment":[{"href":"https:\/\/propakistani.pk\/proproperty\/wp-json\/wp\/v2\/media?parent=16377"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/propakistani.pk\/proproperty\/wp-json\/wp\/v2\/categories?post=16377"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/propakistani.pk\/proproperty\/wp-json\/wp\/v2\/tags?post=16377"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}