The Punjab government has introduced a new tax deduction system for digital payments across the province, offering lower tax rates on card and electronic transactions to encourage cashless payments and improve tax transparency.
According to the Punjab Revenue Authority (PRA), taxes deducted through e-payments and credit or debit card transactions will be transferred directly to the government treasury, reducing the chances of tax evasion.
Under the new system, restaurants and hotels will charge 16% tax on cash payments, while customers paying through credit cards or digital methods will pay only 8%, effectively receiving a 50% tax discount.
The PRA urged citizens to ask for receipts and report restaurants or food businesses that fail to issue them.
The authority also announced revised tax rates for several service sectors. Beauty parlours, salons, fashion designers, cosmetic surgery, plastic surgery, skin treatment and laser clinics will be subject to a 5% tax.
Meanwhile, event management companies, tour operators, gyms and laundry services will be taxed at 8%.
The PRA said the new system is aimed at promoting digital transactions, increasing transparency in tax collection and ensuring taxes are deposited directly into the government treasury.
The authority added that its crackdown on tax defaulters is continuing, with recoveries worth millions of rupees already made.
