KARACHI: The Sindh government collected Rs3.290 billion from stamp duty during July-Dec 2016-17 compared to Rs3.088bn in the corresponding period last year, but the collection fell short by almost 31 per cent against the first half target of Rs4.5bn.
Stamps Deputy Chief Inspector Mohammad Aslam told Dawn that the high rate of withholding tax imposed by the Federal Board of Revenue (FBR) on the sale of property units had adversely impacted the stamp duty collection in the province.
The property sale deeds registration contributes 60pc to the total stamp duty revenue while the rest comes from financing documents, contracts, leasing, shares and shipping instruments.
He further said that the registration of sale deeds of property remained suspended for the first two months (July and August) of this fiscal year due to confusion over the property valuation rates introduced by the FBR in addition to the valuation table practised by the Board of Revenue Sindh (BoR).
The official, however, said several measures were taken in the budget to improve the stamp duty collection.
Property rates in the valuation table were increased by 20pc. In addition to this stamp duty on financing documents was increased by 50pc, on bill of exchange by 100pc, bill of entry (goods declaration) by 100pc, on power of attorney by 100pc and general power of attorney Rs5,000 from Rs3,000. For farmland deeds, the duty on Productive Index Unit was raised to Rs500 from Rs300.
The official maintained that the Sindh government continued losing massive stamp duty revenue on Goods Declarations (GDs) filed through Web-based One Customs (WeBOC). Despite several requests the Customs refused to incorporate stamp duty in the system. The duty is presently charged on GDs filed manually.
Meanwhile, the BoR has proposed to re-arrange status of housing localities for the purpose of calculating stamp duty according to the value of property. It has been planned to merge housing and commercial localities listed in categories 4 and 5 into category 3. The planners believe that property rates in categories 4 and 5 have since increased substantially.
Published in Dawn, January 22nd, 2017
