Islamabad Real Estate Faces Fiscal Challenges Amid Taxation Turmoil
The Capital Development Authority (CDA) of Islamabad has rolled out a comprehensive taxation plan affecting real estate property across the city, drawing mixed reactions from property owners and stakeholders.
Under the new tax regime, small-scale property owners holding 140-square-yard plots in sectors and housing societies like Shehzad Town, Margala Town, and Rawal Town are facing a significant burden, with taxes amounting to Rs24,000. This measure is expected to impact numerous landowners, reshaping the financial landscape for many in the federal capital.
Farmhouse owners are also feeling the pinch, with taxes ranging from Rs180,000 for properties spanning eight kanals to a hefty Rs442,000 for larger properties between 90 and 120 kanals. This escalation in property taxes could have profound implications for the rural real estate sector.
In the bustling commercial hub of the Blue Area, commercial property owners are subject to substantial taxes. Ground floor establishments will bear a tax burden of Rs32 per square foot, while basement spaces will be taxed at Rs22 per square foot. Additionally, residential apartments in this area will face a tax rate of Rs26 per square foot.
Moreover, the notification outlines taxation rates for various other commercial entities. Private hospitals will be taxed at Rs22 per square foot, while petrol pumps and CNG stations face a tax of Rs180 per square yard. Marquees and marriage halls are also included, with a tax of Rs13 per square foot.
While these taxes are anticipated to generate substantial revenue for the CDA, they have raised concerns among property owners, particularly smaller stakeholders and farmhouse owners, who fear the financial strain it will impose. Additionally, the business community, traders, and property advisers have voiced apprehensions over the potential negative impact of these tax hikes on the property sector.
The government’s move to introduce additional taxes on Islamabad’s real estate properties has sparked a debate among stakeholders, highlighting the complex dynamics of taxation and its ramifications on the real estate landscape.