Here is a bad news for users of online taxi services. Provincial sales tax @4% approved on online taxi services by the government of Punjab. Government of Sindh also previously approved same tax.
Committee on legislative business of Punjab cabinet allowed to impose 4% sales tax on services provided by many online taxi services working in private sectors, like Airlift, Uber, Careem, Daewoo Cab, Albayrak, Metro cab, Faisal Movers, Bookme, My cab Pakistan, iCab Pakistan and many more.
Application of sales tax on taxi services in Pakistan will lead to increase of taxi fares. It is a bad news for online taxi services users. Because these online companies will shift the burden of sales tax on the app users of such online taxi services.
Raja Basharat, Provincial minister of law headed the committee. It was 22nd time that committee was meeting regarding the above issue with the law minister.
Harmonisation of Sales Tax Rates in all Provinces
Different sales tax rates which are in consideration in different provinces of Pakistan should be unified and identical instead of charging it differently. There is a proposal from KPK government to impose 2% sales tax on online cab services, and if we compare it with other provinces then there becomes huge difference which needs to consider by other provinces also and try to reduce the rate of tax to avoid the burden on common person.
The reduced tax rates on online taxi services will also attract to bring investment in Pakistan. Such like, many investors are intended to bring facility of 1122 ambulance service as online service.
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