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Tax and assets

This is with reference to your editorial ‘Tax and assets’ (June 20). You have rightly pointed out that “many of the assets as declared by MPAs are probably grossly undervalued.”
The lawmakers may have their own reasons for not declaring the correct values of their properties; one reason being that they don’t want to appear affluent in the eyes of their voters.
But the practice of declaring lower property values has been in vogue before partition, principally to avoid paying high transfer charges, taxes and stamp duties, as well as to save the buyer from explaining how he has been able to buy such expensive property though he pays very little income tax.
To curb this practice, one way is to lower the transfer charges, taxes and stamp duties.
Another is to empower the FBR to buy and auction under-valued properties.
And to determine the real value of bungalows and plots, FBR officers can anonymously call any of the numerous property brokers who advertise in the classified sections.
It will be found that often the declared value of a property is less than a third of its real value.

SHAKIR LAKHANI
Karachi
Published in DAWN, June 29, 2011

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