ISLAMABAD - The government on Monday constituted a committee of developers and real estate agents to give recommendations to the government for additional taxation measures on real estate sector, particularly for the appointment of valuers.

The decision was taken in a meeting between Advisor to Prime Minister on Revenue Haroon Akhtar and the delegation of Real Estate Associations. The committee would give its recommendations to the Federal Board of Revenue for consideration in next couple of days.

Sources have informed that developers and real estate agents intimated the government’s officials that business of property had suffered badly due to new taxation measures.

They further said that if new measures persisted, these would result in the closure of real estate business, diverting investments from Pakistan to other lucrative foreign destinations. “The appointment of valuers for valuation of immovable properties would open doors of corruption,” said a real estate agent while talking to The Nation. “The experience of appointing valuers for the evaluation of immovable properties failed in the past,” he recalled.

It is worth mentioning here that Finance Act 2016 levied capital gain tax at the rate of 10 percent on the sale of a property held for a period up to five years, whereas, capital gains on property sold after being held for a period of more than five years were exempted from the tax.

The Act provided that the collector shall determine the capital gain through calculating difference in valuation at the time of acquisition and sale on the basis of valuation table notified by the collector of the district under section 27-A of the Stamp Act, 1899 or the recorded value in the transfer deed, whichever is higher. Since this law is provincial law. Federal Enactment has prevailing powers.