Pakistan Embassy in US served tax notice

WASHINGTON: The Embassy of Pakistan has been served a notice by the district government requiring it to pay more than $70,000 in back taxes.

The notice of delinquency warns that the owner could lose the right to property. It was also forewarned that the owner should avoid the tax sale and pay $70,748.55 before the last day of May this year.

The Tax Sale here is the forced sale of property by a government entity for unpaid taxes by the property's owner. It further notifies that the "amount you must pay to avoid the tax sale may be less than the total amount owed by the real property account."

The twelve page notice marked with the number 8582646170501; assessed the total amount payable to above 100,000 dollars and identified the Pakistan government as the owner of the property on R Street, Northwest.

When inquired, the embassy staff acknowledged the noticed but also claimed that the notice was a misunderstanding since the property has a diplomatic status and cannot be taxed. "We understand that the Tax Notice was sent erroneously issued by the DC government," embassy staff, Syed Fawad wrote back.

"The properties are in custody of the Government of Pakistan having diplomatic status and cannot be taxed," he said, adding that the issue will be raised with the Department of State to resolve amicably.

The embassy seems to be partially correct since according to the law based on the Vienna Convention on Consular Relations, foreign governments are entitled to exemption from real estate taxes on properties that are owned by the government and used as a consulate or as the residence of the career head of a consular post.

A diplomatic note sent out by the State Department about its Foreign Missions Act further says that "based on the Vienna convention on Diplomatic Relations, customary international law, and bilateral agreements, foreign governments are entitled to exemption from real estate taxes on properties owned by the government and used by its diplomatic mission.

Such properties include chanceries and chancery annexes, and the residence of the Chief of Mission. Properties owned by foreign governments and used as residences of the members of the diplomatic mission accredited to the United States may also be granted exemption on the basis of the Vienna Convention on Diplomatic Relations, customary international law and reciprocity.

However, the diplomatic note by the State Department also clarifies that "the Chiefs of Mission are reminded that any portion of property owned by foreign governments that is not used for diplomatic or consular purposes of that sending State will not benefit from tax exemption or inviolability."

One of the top embassy official insisted that the embassy is a defaulter, even though the property identified as taxable has been abandoned for some time.   The property at one point was used as a consulate and later as a defense section of the Pakistani embassy. Once the diplomatic staff was moved to the present location, the older building was left unused.  Over the years it was debated if the property should be sold, rented out or turned into a housing project, for some reason nothing was decided about the property.