LAHORE: Restaurants in the provincial capital have started levying 16 per cent sales tax on credit and debit cards in violation of sales tax laws; however, the Punjab Revenue Authority (PRA) is now cracking down on violators.
The Punjab government reduced the sales tax rate on credit and debit cards to restaurant owners from 16 per cent to 5 per cent in the current fiscal year yet there were complaints from customers that many restaurants still charged 16 per cent sales tax.
PRA spokesperson said that the authority has taken notice of the matter and has decided to crack down on violating restaurants. “We have been receiving complaints from people on which we have also issued notices to some restaurants. If restaurant owners do not comply with tax laws, strict action will be taken against them.”
Asim Javed, a resident of DHA, said that restaurant owners also deduct full tax on payments made through credit or debit cards, whilst claiming that the “government has not given any tax exemption”. Many other Lahori residents have reported having to pay a 16 per cent tax at various restaurants in spite of the deduction from the government.
Abdul Moeed, the owner of Wasabi restaurant, told Pakistan Today, “We charge only 5 per cent tax on credit and debit card payments and we have been following this decision by the government ever since. This is a very simple process as it gives a discount to the customer and the tax goes to the exchequer. We have been regularly submitting the tax collected on cash payment to the government.”
