Urban Immovable Property Tax

[SCHEDULE II]

  1. Buildings and Lands within the limits of urban areas shall be divided into category A1, A, B, C and D by the Government through Notification in the Official Gazette depending on location, value, type of business therein, rental value, civic amenities, age of building and other variables related to immovable properties.
  2. Buildings acquired for the use by Government, Semi-Government, Non-Governmental Organizations, Development Financial Institutions, private commercial organizations (local/ internationals shops/chain, outlets, local and International Brands, Wedding Halls, Hotels, Restaurants and all shops and falling within A1, A and B Category of Immoveable Property), Guest Houses, Hostels or for any commercial use or by Banks shall be assessed and taxed 18% of the actual annual rent. In case buildings other than those exempted under Section-4 of this Act, which are owned and occupied by such organizations, tax shall be levied on the assessed annual rental value of such buildings on the rates prescribed hereinbefore.
  3. Both lesser and lessee shall inter into written agreement in quadruplicate clearly indicating annual rent to be derived, and share copies thereof with assessing authority on annual basis.
  4. All payments of rent shall be preferably made through bank transfers or pay orders and no cash payment may be accepted.
  5. Building used as shops by the registered owner himself only, divided into three localities namely A1, A, B, depending on the area shall continue to be assessed and taxed in accordance with the method and rate prescribed clause 6 and 7 below. All shops categorized as C and D will also continue to be assessed with the same method.
  6. The “A1 and A” localities shall, for the time being, be defined in Provincial Capital. Locality “A” may be introduced in Divisional Headquarters.
  7. The locality factors as worked out for computing the tax are-
LocalityFactor (Tax Rate)
A1
(located within 100 yards of either sides of the Main road of Peshawar).
39 (Thirty Nine)
A30 (Thirty)
B14 (Fourteen)
C10 (Ten)
D8 (Eight)
  1. The above factors are for the Provincial Headquarter, that is for Peshawar. There shall be a rebate of 10% on the total tax calculated on the basis of the above factor value in respect of former Divisional Headquarters and 20% rebate on the total tax so calculated in respect of all other rating areas. There shall also be a rebate of 10% on 1st floor of the building and 20% rebate on floor other than ground and first floor.
  2. The tax shall be calculated as under:
    1. Area in square yards.
    2. Covered area in square feet, provided that open sheds in the commercial units shall be counted as one half of its total measurements, while calculating the covered area; and
    3. (a) + (b) multiplied by the locality factor.
  3. For educational Institutions:
    1. The tax shall be calculated on the basis of covered area only.
    2. The area of the plot as required per item 9(a) above shall not be taken for computing the tax. This is to encourage the institutions in providing sports and other recreational facilities to their students; and
    3. The tax calculated on the basis of (a) above shall get a special twenty percent rebate, being provided to all the educational institutions. Provided that no rebate shall be given to building obtained on rent.
  4. Petrol pumps and CNG Stations with convenience store shall be charged at flat rate of Rs.22,500/- and those without store at Rs. 11,500/- per annum.
  5. Service Station of vehicles, irrespective of operating in addition to other service such as filling station or otherwise shall be charged at flat rate of Rs:20,000/- per annum
  6. Industrial buildings with in the limits of rating areas shall be assessed for the purpose of this tax at a flat rate of Rs. 2.50 per square foot of the building. The provision of item 10(b) above shall be applicable to all the industrial areas as well.
  7. Building and Lands used for erection of Mobile Phone Towers shall be assessed and taxed at the rates:
  • Provincial Headquarter ………………………………………………………… … Rs: 40,000 per annum;
  • Divisional Headquarter and respective sub-urban areas …………………. Rs: 30,000 per annum;
  • District Headquarter and respective sub-urban areas …………………….. Rs: 20,000 per annum;

Substituted vide Khyber Pakhtunkhwa Finance Act 2019 (Khyber Pakhtunkhwa Act No. XXVII of 2019)
Amended vide Khyber Pakhtunkhwa Finance Act 2019