What is Sales Tax on Services?
Sales tax on services is the tax provinces charge on services such as restaurants, salons, gyms and courier work, collected by PRA, SRB, KPRA and BRA under provincial laws.
Updated
Meaning
English
Sales tax on services is the tax provinces charge on services such as restaurants, salons, gyms and courier work, collected by PRA, SRB, KPRA and BRA under provincial laws.
Roman Urdu
Sales tax on services woh tax hai jo sooba restaurant, salon, gym aur courier jaisi services par lagata hai, aur PRA, SRB, KPRA aur BRA wasool karte hain.
Also called provincial sales tax, PST, services tax, PRA tax, SRB tax.
Example
A cafe in Lahore is registered with the Punjab Revenue Authority. Each bill shows the PRA tax on the service, and the cafe's POS reports the invoice to PRA's electronic invoice monitoring system so the bill carries a PRA invoice number.
How it works
After the 18th Amendment, provinces collect sales tax on services under their own laws: the Punjab Revenue Authority (PRA) in Punjab, the Sindh Revenue Board (SRB) in Sindh, the Khyber Pakhtunkhwa Revenue Authority (KPRA) and the Balochistan Revenue Authority (BRA). Each sets which services are taxable, the rates and the registration rules, and they differ, for example between card and cash payments in some provinces.
Restaurants, cafes, salons, gyms, hotels and many other service businesses fall under these rules. Several authorities require real-time reporting of invoices from the POS, as PRA does through its e-IMS system.
In Nafaa
Nafaa's Tax page supports PRA, SRB and KPRA alongside FBR POS as optional integrations, with POS registration steps for each authority, every invoice's status and monthly return figures per authority.
Official source
Punjab Revenue Authority and its e-IMS, Sindh Revenue Board and Khyber Pakhtunkhwa Revenue Authority. Rates, thresholds and dates change with Finance Acts and S.R.O.s; check the current position with the authority or a tax adviser.
Related terms
- Sales Tax (GST)
Sales tax, often called GST in Pakistan, is a tax on the supply of goods charged under the federal Sales Tax Act, 1990, with services taxed separately by the provinces.
- Service Charge
A service charge is a percentage or fixed amount a restaurant or service business adds to the bill for service, separate from the price of food and from tax.
- E-Invoicing (Digital Invoicing)
E-invoicing is issuing sales tax invoices electronically through a system connected to the tax authority, which validates each invoice and gives it a unique number.
