The Khyber Pakhtunkhwa Revenue Authority has set the 25th of this month as the deadline for wedding hall owners across the province to choose between a fixed sales tax regime or a percentage-based regime for the fiscal year 2024-25.

According to information from the KPRA media wing, under the Khyber Pakhtunkhwa Finance Act, 2024, the provincial government has introduced a fixed sales tax regime for services provided by wedding halls. The halls are categorized into Category-A, Category-B, and Category-C based on their seating capacity.

To implement this change, a new clause has been added to Entry No. 1 of the Second Schedule to the KP Sales Tax Act, 2022, effective from July 1, 2024.

This measure aims to simplify payment processes within the sector, promoting transparency and fairness. It is expected to reduce compliance costs and enhance administrative efficiency by streamlining tax collection, thereby reducing the need for extensive tax enforcement and audits.

The new tax rates are notably lower compared to the previous rate of 8% of service value.

As per the amendments, owners or authorized representatives of wedding halls, lawns, pandals, and shamianas (classified under 9801.3000) must select the new regime by June 25, 2024. They are required to submit their choice to the Khyber Pakhtunkhwa Revenue Authority using the format available on the official website at www.kpra.gov.pk or through this link: https://kpra.gov.pk/option-for-the-person-providing-or-rendering-marriage-halls-servicesndals-and-shamianas-services/.

Failure to opt for the new tax regime by the specified date will result in a higher sales tax rate of 11% on the actual value or charges received from customers, along with increased tax enforcement and audits.