Taxation

The Punjab government has brought as many as 16 more sectors under the ambit of sales tax on services. The newly added sectors include services provided by

 

1) software or IT-based system development consultants,

2) technical/scientific and engineering consultants,

3) other consultants,

4) services provided by tour operators (other than Hajj and Umrah),

5) manpower recruitment agents, services provided by the security agency,

6) services provided in respect of mining of minerals,

7) oil and gas including related surveys and allied activities.
8) advertising agents,

9) share transfer agents,

10) business support services,

11) services by property dealers,

12) fashion designers,

13) architects/town planners and interior decorators,

14) rent a car,

15) car/automobile dealers and

16) services provided in respect of manufacturing or processing on toll or job basis (against processing on conversion charges) have also been brought under the scope of provincial sales tax.

A notification bearing No SO (TAX)1-2/97 was issued by the Finance Department of the Punjab Government with effect from July 01, 2013 expanding the list of services on which the Punjab Revenue Authority (PRA) was collecting sales tax on services. Prior to this, the Punjab Revenue Authority (PRA) which started working with effect from July 01, 2012 was collecting sales tax from 21 categories of services.

With the addition of 16 more now the number of services to be taxed under provincial sales tax has reached to 37. The notification issued in this regard said that it would come into force with effect from July 01, 2013 and rate of the sales tax will be 16 percent.