Stamp duty on land transactions: real estate business in Sindh shrinking sharply

[Lahore_Real_Estate]

KARACHI (July 19 2010): Real estate business in the province is fast shrinking ever since the Sindh government has imposed stamp duty on the residential and commercial land transactions, Business Recorder learnt on Sunday.

Interestingly, the provincial land regularisation agencies, including the Board of Revenue (BoR), Sindh Katchi Abadi Authority (SKAA) and the City District Government Karachi (CDGK) could not receive a single land regularisation case during the first 17 days of the financial year 2010-2011.

The Sindh government had imposed 2 percent stamp duty on residential and 5 percent on commercial land transactions to enhance revenue collection to reduce budgetary shortfall for the year 2010-11, but it affects adversely.

An official document exclusively available to Business Recorder revealed, the Sindh government has imposed Rs 495 to Rs 14850 on per square yards of open residential plots, Rs 863 to Rs 34500 on per square yard of open commercial plots, Rs 1100 to Rs 2200 on per square yard of open industrial plots, Rs 1155 to Rs 23100 on per square yard of built residential property, Rs 2070 to Rs 41400 on per square yard of built commercial property, Rs 210 to Rs 386 on per square yard of built industrial property and Rs 125 to Rs 2475 on per square yard of flats.

The provincial government has divided whole city into six zones. In Zone-I are: Clifton, Defence, Society, Old City, PECHS. Zone II areas are: North Nazimabad, Gulshan-e-Iqbal, Nazimabad, Gulistan-e-Jauhar, F.B. Area, Buffer Zone, Godhra Camp and Soldier Bazaar. Zone-III Al-Falah Society, Drigh Cantonment, Model Colony, P.I.B Colony, Pak Colony, Rafa-e-Aam Society and Shah Faisal Colony.

In Zone IV are Korangi, Landhi, Malir, Deh Drigh, green Town, Liaquatabad, North Karachi (sectors 1 to 6), Zone V includes Sher Shah, SITE, Qasba, Old and New Golimar, Kemari, North Karachi (sectors 6 to above) and Baldia, Surjani, Hawksbay and Maripur were kept in zone VI.

The duty imposed on one square yard of open residential plots in zone A-I is Rs 14850, zone-I Rs 9625, zone-II Rs 5500, zone-III Rs 2475, zone-IV Rs 1630, zone-V Rs 990 and zone-VI495. Duty on per square yards of open plots are zone A-I Rs 34500, zone-I Rs 21563, zone-II Rs 10350, zone-III Rs 5175, zone-IV Rs 2760, zone-V Rs 1725 and Rs 863 per square yard of open commercial plots.

The tax on per square yard of open plot in zone-I is Rs 2200 and in zone-II is Rs 1100. Duty on per square yard of built-up residential property is zone A-I Rs 23100, zone-I Rs 12375, zone-II Rs 7700, zone-III Rs 3300, zone-IV2475, zone-V Rs 1650 and zone-VI Rs 1155. Tax on per square yard of build commercial property is zone A-I 41400, zone-I Rs 28750, zone-II1 Rs 4950, zone-III Rs 6900, zone-IV Rs 4658, zone-V Rs 3105 and Rs 2070 on per square yard of zone-VI.

Stamp duty on per square yard of built-up industrial property in zone-I is Rs 386 and the property in zone-II is Rs 210. Duty on per square foot of built-up flats is zone A-I Rs 2475, zone-I 1788, zone-II Rs 990, zone-III Rs 495, zone-IV Rs 413, zone-V Rs 248 and Rs 125 on per square foot of built up flats.