Major revision of flat, bldg tax rate proposals likely

Doulot Akter Mala | Published: June 21, 2014 00:00:00 | Updated: November 30, 2024 06:01:00

The government is set to relax the proposed tax rates on flats, buildings or structures by levying those on per square metre instead of per square feet for the upcoming fiscal year (FY), competent sources said. Â
The revision is likely to be incorporated in the Finance Bill-2014 that the parliament is likely to adopt on June 29, 2014.
Officials said the government high-ups have found the tax rates proposed in the budget to be too high if it is set on the basis of per square feet for the real estate sector.
Following instruction of the Ministry of Finance (MoF), the tax authorities have moved to impose it on per square metre.
Sources said the changes will be made considering prevailing crisis in the real estate sector due to sluggish trend in sales of apartments.
The proposed tax rates on land will also be specified by areas -- posh to common -- to make the tax rate tolerable for the taxpayers.
In the budget proposal for fiscal year (FY) 2014-15, the government has proposed new tax rates for transfer of land, any structure, building, flat, apartment or floor space on the land.
"â€¦.the rate of tax shall not exceed Taka ten lakh and 80 thousand per katha (1.65 decimal) for land, Taka 90 per square feet for any structure, building, flat, apartment or floor space on the land, if any, or four per cent of the deed value, whichever is higher," the Finance Bill-2014 said.
Officials said some of the areas of proposed land transfer tax will be revised following instruction from the government high-ups.
In a recent post-budget meeting with the Metropolitan Chamber of Commerce and Industry (MCCI), state minister for Finance and Planning MA Mannan hinted at reviewing the land and household taxes amending the provision concerned in the proposed Finance Bill.
He, however, admitted that the tax measure on land and house property has been incorporated hurriedly on being concerned over allegation of accumulation of black money in this sector.Â Â Â
In the proposed budget, the NBR has just doubled the existing tax rates as per 'Mouza' rates by the land authorities on transfer of land for the upcoming FY.
Sources concerned said maximum tax rates, Tk 10,80,000 will be imposed on land transfer in posh areas includingÂ Gulshan, Banani and Baridhara while other areas will have to pay just double amount of tax than that of the current one.
The NBR would fix different tax rates on transaction of land transfer by defining commercial, residential, industrial areas.
Tax officials have considered the newly proposed land tax as one of the major sources of income tax collection for the upcoming year.
They expect income tax worth Tk 20 billion from the upward revision of land tax on the basis of per katha (1.65 decimal).