Govt plans market-based property valuation to curb tax evasion,

The government is preparing a major crackdown on tax evasion and undisclosed wealth accumulation by mandating registration of immovable property transactions at their actual market values rather than the existing minimum mouza rates.

According to land ministry officials, special committees at the divisional, district, and upazila levels have been instructed to determine the actual market prices of land, residential plots, flats, and commercial properties within four months.

Md Emdadul Hoq Chowdhury, acting secretary at the land ministry, told The Business Standard that the initiative would be implemented in phases.

"An inter-ministerial meeting has already been held, and committees will be formed in line with its recommendations," he said. "These committees will determine the true market value of land and other assets. The initiative is currently in its early stages."

He added that committee-led valuation is an interim measure. In parallel, the government is collaborating with South Korea to build an automated real estate valuation model using scientific parameters.

"A project to develop the model is underway and is expected to take one and a half to two years to complete," the secretary explained.

Welcoming the initiative, Dr Fahmida Khatun, executive director and distinguished fellow at the Centre for Policy Dialogue (CPD), told TBS that proper implementation would significantly boost public revenue.

"However, determining actual market values alone will not be enough. The land and property registration administration must also be modernised as current systems and documentation processes remain fraught with complexities," she said.

Dr Fahmida added that the new framework must be standardised and science-based to ensure uniform application. "Influential individuals and vested interests must not be allowed to bypass the system for undue benefits."

Dr Iftekharuzzaman, executive director of Transparency International Bangladesh (TIB), said the move is a positive step as effective implementation of this long-awaited reform could curb illicit transactions and the influence of black money in property deals.

He said clear criteria based on location and property type, regular updates, and transparent, accountable implementation would be essential. Mandatory public hearings involving relevant stakeholders would also help ensure positive outcomes.

Revised fees, tax from July 2027

Officials confirmed the move follows a 16 September high-level meeting chaired by the prime minister. On 8 October, the Prime Minister's Office (PMO) directed both the land and law secretaries to execute the directives.

The land secretary was tasked with recommending legal, institutional, and digital reforms, while the law secretary was instructed to form valuation committees and assess all mouzas nationwide within four months.

Under the plan, divisional committees will set valuations in major cities, district committees will oversee municipal and cantonment zones, and upazila committees will handle all remaining areas.

These committees will evaluate past deed values, recent transaction trends, land classifications, locations, connectivity, infrastructure development, official benchmarks, market surveys, and feedback from public hearings.

A senior land ministry official revealed that a progress review meeting chaired by the prime minister will take place in the first week of January 2027, following the completion of the nationwide valuation drive.

The review will assess how applying existing tax rates and fees to actual market values impacts total transaction costs and public revenue. Based on the findings, the government plans to rationalise fee structures to keep the tax burden reasonable while encouraging full transparency.

The revised rates are expected to take effect on 1 July 2027.

Outdated valuations behind revenue leakage

The drive follows assessments by the Finance Division, which identified the widening gulf between registered rates and actual market values as a primary source of state revenue leakage and illicit capital formation.

The Minimum Market Value Determination Rules, 2010 established benchmark property values. Although Rule 5 was amended in November 2015, no comprehensive nationwide mouza revaluation has taken place since, despite steep property appreciation across Bangladesh.

Data from the Gulshan Sub-Registry Office illustrates the gap. Current government valuation sets residential land at Tk32.34 lakh per decimal in Abdullahpur, Tk10.01 lakh in Anul, Tk2.09 lakh in Korail, Tk28.48 lakh in Joar Sahara, Tk36.03 lakh in Tejgaon Industrial Area, Tk15.87 lakh in Dakshinkhan, and Tk59.09 lakh in Mohakhali.

Land in Bangladesh is commonly measured in katha, where 1 katha equals 1.65 decimals.

Anul mouza covers mainly Uttarkhan and some adjoining settlements and agricultural areas around northeastern Demra and Ashkona. Korail includes areas between Mohakhali and Gulshan-Banani, as well as parts of the Gulshan Lake waterfront. Joar Sahara covers parts of Bashundhara Residential Area and surrounding neighbourhoods.

In reality, market prices in these locations – spanning commercial hubs like Mohakhali and Tejgaon, to residential areas like Bashundhara (Joar Sahara) – are several times higher. Despite this, most property deeds are registered at or near the official minimum threshold.

A scan of online marketplaces shows actual asking market prices. On platforms such as Bikroy.com, Sekander Group lists three-katha plots in Block N of Bashundhara Residential Area at Tk1.17 crore to Tk1.20 crore per katha. Similarly, Probashi Palli Group advertises land in the Dhaka-Mawa City project at Tk60 lakh per katha.

Revenue potential

According to the National Board of Revenue, the government collected Tk12,643 crore in revenue from land and flat registration fees and taxes in FY24.

The CPD estimates that the government loses around Tk6,000 crore annually because registered deeds do not reflect actual property transaction values.

Economist Fahmida said most land and other immovable properties are registered at mouza values, leaving the gap between declared and actual prices undisclosed and depriving the government of revenue while fuelling the accumulation of undisclosed wealth.