The Punjab government has announced a 50% tax relief for businesses and customers using digital payment methods as part of its efforts to promote a cashless economy.
Under the new Punjab Revenue Authority (PRA) policy, hotels and restaurants will be charged an 8% tax on digital transactions, compared to 16% on payments made in cash.
The policy also introduces automatic tax deduction through e-payments and card transactions to enhance transparency, improve tax collection, and simplify compliance for businesses.
Officials said the initiative is aimed at encouraging digital transactions while ensuring better revenue generation to support public welfare and development projects across Punjab.
Earlier, Punjab Revenue Authority had increased the sales tax on restaurants and service sectors in Punjab.
According to the details, the authority increased the sales tax from five per cent to eight per cent, and informed the restaurants that it would be applicable immediately.
Punjab Revenue Authority also said that the provincial government will receive an eight per cent tax on every purchase through debit or credit card.
The Punjab government will receive sales tax of eight per cent from Wedding halls, catering services, event management, travel and tour operators, car rental services, fitness centres, apartment complex management, and property dealers.
Punjab Revenue Authority also applied sales tax to architects, warehouses, and cold storage.
In this regard, all relevant business entities have been directed to immediately update their invoicing, billing, and compliance systems in accordance with the new tax rate.
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