HARIPUR: A recent hike in taxes on land transfer will cost Haripur district billions of rupees, fear officials.

They told Dawn on Tuesday that land sellers and buyers chose to make transfer deeds on stamp papers to avoid taxes, a move that would increase litigation.

Official sources said the FBR had revised advance tax on the transfer, registration, recording and attestation of immovable property.

Now, a filer land seller will pay three per cent tax and a non-filer six per cent to the Federal Board of Revenue, while a non-filer and filer buyer will pay 10.50pc and 3pc tax, respectively.

The officials said the filer land seller had been made to have a certificate from the Commissioner Inland Revenue, FBR, to pay five per cent of the tax on the total value of land, while the percentage for non-filer was 20.

Officials insist move to reduce tax collection, increase litigation

They said the provincial government had abruptly increased the value of the land by 10 per cent in Haripur increasing the chances of tax evasion.

Sources claimed that following the upward revision on taxes on land transfer deeds and registration, sellers and buyers had started inking the deeds on stamp papers instead of paying stamp duty to the revenue department as they believed that it was too heavy to pay for them.

They said Haripur tehsil used to collect Rs1.5 billion annually from stamp duty on land transfer and registration deeds but after tax hikes, the revenue collection would be short of target totalling Rs400-Rs500 million in the current financial year.

The officials said the situation won’t be any different in Ghazi and Khanpur areas.

Also, property dealers rejected tax hikes and insisted the move would damage their business and further burden “poor” property owners and buyers.

Fiaz Hussain, Hafiz Amjad and Arshad Awan of the Property Dealers Association told reporters here that they had informed the deputy commissioner about their grievances about tax hikes and urged him to take them up with authorities for resolution.

They demanded the federal and provincial government to withdraw tax increase.

Published in Dawn, Aug 2nd, 2023