Ambitious fiscal plan for 2023-24: Gain tax on plots, flats and apartments and commercial establishments has doubled and redoubled.
The Ministry of Finance has announced an ambitious tax plan for property registration in the upcoming fiscal year 2023-24. The key highlights of the plan include a significant two-fold increase in the rates of gains tax on land and flat registration. Additionally, taxpayers are set to face tougher penalties for late submission of income tax returns.
Under the new measures, the gain tax on land and flat registration will be raised to 8% from 4% in the Rajdhani Unnayan Kartripakkha (Rajuk) and Chattogram Development Authority (CDA) areas, according to the finance ministry. In other areas of city corporation and district-level municipality, the rate will be increased to 6% from the present 3%. A 4% tax rate will be applicable for Upazila-level municipalities and 2% for any other areas instead of 1%.
Additionally, the maximum limit for the gain tax will be raised to Tk20 lakh per katha, whichever is higher, up from the current Tk10.80 lakh and 4%, separately. The penalty for late submission of income tax returns will also be doubled to 4% of the payable tax, and these changes will be incorporated into the new income tax law. For properties, including houses, apartments, or spaces, the tax is either Tk 800 per square meter or 8% of the deed value is determined anywhere in the country.
Presently, the registration costs for the land include a 1% registration fee, 1.5% stamp duty, 2% local government tax, and 4% or 3% gain tax.
Gain tax rates revised for different areas of RAJUK & CDA
In all areas under RAJUK or CDA, registration tax of a minimum fixed amount or 8% of the deed value, whichever is higher. We are categorizing the areas under the minimum amount payable.
Under RAJUk Jurisdiction
Minimum Taka 20 Lakh
Gulshan, Banani, Motijheel, Dilkusha, North South Road, Motijheel Extended Area, and Mohakhali,
Minimum Taka 12 Lakh
Karwan Bazar, Shahbag, Panthopath, Bangla Motor and Kakrail
Minimum Taka 10 Lakh Minimum
Banani DOHS, Dhanmondi, Baridhara DOHS, Mohakhali DOHS, Bashundhara, Niketon, and Baridhara
Minimum Taka 8 Lakh
Bangabandhu Avenue, Badda, Sayedabad, Postogola, Gendaria, and Narayanganj
Minimum Taka 6 Lakh
Nababpur and Fulbaria
Minimum Taka 5 Lakh
Segunbagicha, Kakrail R/A, Bijoynagar, Eskaton, Green Road, Elephant Road, Fakirapool, Arambagh, Moghbazar, Tejgaon Industrial Area, Shere-e-Bangla Nagar, Lalmatia and Cantonment area.
Minimum Taka 3 Lakh
Uttara (Sec 1-9), Khilgaon Rehabilitation Area, Azimpur, Rajarbagh, Rajuk Purbachal Residential Model Town, Bashundhara Residential Area, and Jhilmil Residential Area
Minimum Taka 2.5 Lakh
Segunbagicha, Kakrail, Bijoynagar, Eskaton, Green Road, and Elephant Road (Properties 100 feet away from the main road will be considered in this bracket)
Minimum Taka 1.2 Lakh
Uttara (Sector 10-14), Nikunja, Badda Rehabilitation Area, Genderia Rehabilitation Area, Shyampur Rehabilitation Area, IG Bagan, and Tongi
Minimum Taka 1 Lakh
Shyampur, Postagola Industrial Area, and Jurain Industrial Area
Under CDA Jurisdiction
Minimum Taka 8 Lakh
Agrabad and CDA Avenue
Minimum Taka 5 Lakh
Khulshi
Minimum Taka 3 Lakh
Halishahar, Panchlaish, Nasirabad and Mehedibag
Moreover, in areas beyond city corporations in Gazipur, Munshiganj, Manikganj, Narsingdi, Dhaka, and Chattogram, as well as municipal areas in district headquarters, the tax has been increased from 3 percent to 6% of the deed value.
Tax authorities aim to boost compliance with stricter measures
National Board of Revenue (NBR) officials revealed anonymously that the proposed tax measures in the upcoming fiscal year are pitched towards endorsing tax acquiescence, particularly among property owners who have been reluctant to pay appropriate taxes during registration. Additionally, they highlighted a substantial number of taxpayer identification number holders who have long neglected to submit their tax returns.
Despite the tax authorities’ intentions, some experts have voiced concerns over the high tax on land registration, fearing it may burden individuals accustomed to registering properties based on their actual prices.
