ISLAMABAD - Talks between the Federal Board of Revenue (FBR) and real estate sector held on Thursday for determining property prices in major cities for the purpose of taxation remained inconclusive.

The FBR compared its rates with the values submitted by the real estate sector on Wednesday for finalising a new valuation table of properties.

However, consensus could not be developed due to major differences over the values of properties estimated by both the sides. “We will hold another meeting today (Friday) for arriving at consensus on the issue,” said an official of the FBR.

“The FBR believes that the property prices which the real estate agents have estimated are far lower than those worked out by the government-hired valuers,” he added.

The real estate sector representatives said that market values were twice to five times higher than DC rates.

Similarly, the real estate agents were of the view that values worked out by the government were much higher.

“Talks are moving in a positive direction. However, these is a small difference between property rates in cities like Karachi, Lahore and Islamabad, which will be resolved in next couple of days,” said Senior Vice Chairman, Association of Builders and Developers (ABAD) of Pakistan, Arif Jeewa while talking to The Nation.

He said that ABAD had formulated an amnesty scheme in consultations with relevant stakeholders and presented it to the FBR.

“The FBR has assured that it will consider the scheme after finalising the new valuation table for properties,” he added.

“No source of funds should be asked from individuals for the booking of flats, shops and houses for a period of five years. This will encourage investment in construction industry,” reads one of the demands of ABAD presented under the amnesty scheme.

ABAD has also demanded the government to offer an opportunity to the owners of real estate to regularise their assets by paying one percent tax as per the valuation (50 percent higher than the DC/valuation table existing before June 30, 2016) by December 2016.

The real sector has also asked the government to treat all transactions conducted before June 30, 2016 as closed.

It has also demanded that duties and registration charges must be brought down in proportion to the value increased.

“There should be an advance income tax on the sale and purchase of immovable properties,” reads another demand.

The Association has also inquired about the purpose of calculating capital gains on real estate and the value mentioned by DC besides suggesting that valuation may be enhanced by 50 percent from what it was before June 30, 2016.

ABAD has also requested the government to reduce the period for charging capital gain tax by two years at the most.

“The proposed CGT for filers should be charged at the rate of one percent,” says another demand.

“Provincial governments should be encouraged to update these valuation tables on a regular basis. The present scheme of determining fair value through State Bank of Pakistan appointed valuers has created a chaos in the market; therefore it should be abolished,” ABAD requested the government.