FBR Raises Property Taxes in KP, Traders Protest

What happens when the cost of owning or selling property suddenly doubles on paper? In Khyber Pakhtunkhwa, that question is now triggering strong reactions from the business community as fresh tax revisions reshape the real estate landscape.

The Federal Board of Revenue (FBR) has increased property-related taxes across multiple cities of KP, including Peshawar, Mardan, Abbottabad, Dera Ismail Khan, and Mansehra. The revised valuation rates cover both residential and commercial segments, pushing transaction costs significantly higher and drawing immediate criticism from traders.

Sharp Increase in Property Valuation Rates

The revised structure has introduced steep changes in per-marla valuations across key urban markets. In several commercial hubs of Peshawar, rates have nearly doubled, creating concern among property dealers and investors already dealing with slow market conditions.

According to details, residential and commercial properties in Saddar, Peshawar, now carry significantly higher valuation benchmarks. Similar adjustments have been applied in areas such as Ander Shahr Bazaar and Budhni, where both residential and commercial segments have seen sharp upward revisions.

New Tax Structure Across Major Areas

Trader Community Raises Alarm

The Khyber Pakhtunkhwa Traders Union has strongly rejected the revised tax structure, arguing that the timing is particularly difficult for the local economy. Business representatives believe the new rates will slow down property transactions and discourage investment in the region.

From experience, sudden changes in taxation often create uncertainty in real estate markets. Buyers delay decisions, sellers hold back inventory, and overall market liquidity weakens, especially in emerging urban centers like those in KP.

Impact on Buyers and Small Investors

For a middle-income family planning to purchase a small residential plot, the revised valuation system can feel like an unexpected surcharge added at the final stage. It is similar to booking a home renovation within budget, only to discover that approval costs alone have consumed a large portion of savings.

Stakeholders warn that the revised structure could also affect allied industries such as construction, brokerage services, and documentation work, all of which depend on active property movement.

Calls for Policy Review and Dialogue

The traders’ association has urged authorities to reconsider the decision and engage stakeholders before further implementation. They argue that a stable and predictable tax environment is essential for sustaining long-term investment confidence in the property sector.

The coming weeks will be crucial in determining whether the policy is adjusted or remains in force, as market participants closely watch the government’s response to growing concerns.