The Punjab Revenue Authority (PRA) has introduced a simplified tax deduction mechanism for digital payments across the province, under which sales tax deducted through electronic payments and card transactions will now be transferred directly to the government.
According to the PRA spokesperson, the new system is aimed at ensuring transparent tax collection while encouraging the use of digital payment channels.
Under the revised mechanism, services provided by beauty parlours, salons and fashion designers will be subject to a five percent tax when payments are made digitally. The same five percent rate will also apply to cosmetic surgery, plastic surgery, skin treatment and laser treatment centres.
Event management companies, tour operators, gymnasiums and laundry service providers will be taxed at eight percent on digital transactions.
The PRA has also announced a major incentive for the hospitality sector. Hotel and restaurant services paid in cash will continue to attract a 16 percent tax, whereas customers making payments through credit cards or other digital channels will pay only eight percent, effectively reducing the tax burden by half.
The authority said taxes collected from citizens finance welfare and development projects across the province. It urged consumers to prefer digital payment methods and always obtain computerised receipts to ensure taxes are properly deposited into the government treasury.
The PRA also encouraged the public to report restaurants and food businesses that fail to issue proper receipts, stressing that transparent tax compliance is essential for Punjab’s economic development and prosperity.
