Election/option for the person providing or rendering marriage halls, lawns, pandals and shamianas services
KPRA gives June 25 deadline for wedding halls to opt between fixed tax and percentage
PESHAWAR: The Khyber Pakhtunkhwa Revenue Authority has fixed 25th of this month as deadline for the owners of wedding halls across the province to opt between fixed regime of sales tax on services and percentage regime for the coming financial year 2024-25.
According to details shared by the KPRA media wing, through the Khyber Pakhtunkhwa Finance Act, 2024 the Khyber Pakhtunkhwa government has introduced a fixed or flat sales tax regime for the services provided by the wedding halls.
Under the new setup, wedding halls have been divided in three categories i.e., Category-A, Category-B and Category-C based on their seating capacity.
For this purpose, a new clause has been inserted in Entry No. 1 of the Second Schedule to the KP Sales Tax Act, 2022 which shall take effect from the first day of July 2024.
The aim of this step was to simplify the payment mechanism by the sector besides bringing transparency and fairness in the system. This will not only reduce compliance cost but will also increase administrative efficiency through streamlined tax collection processes, reducing the need for extensive tax enforcement and audit mechanisms.
This new tax rates are significantly low as compared to previous rate of 10% of the value of such services.
One of the conditions of the above amendments requires owner or authorized representative of marriage halls, lawns, pandals and shamianas (Classification 9801.3000) to opt for the new regime latest by 25th of June 2024. Such option shall be summitted to the Khyber Pakhtunkhwa Revenue Authority on the format which is available on its official website i.e., https://kpra.gov.pk.
If the concerned businesses don’t opt for the new and simple tax regime by the specified date, they will have to pay sales tax at the enhanced rate of 11% of the actual value or charges received from their customers besides extensive tax enforcement and audit checks.
