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Sindh increases sales tax to 15% on restaurants, hotels, and more to boost revenue.
Sindh increases sales tax to 15% on restaurants, hotels, and more to boost revenue. Digital payments taxed at 8%, cash payments at 15%.
ND
by News Desk
2024-07-02
Sindh increases sales tax to 15% on restaurants, hotels, and more to boost revenue.

The Sindh government has implemented a significant hike in the Sales Tax (SST), raising it from 13% to 15% effective from July 1, 2024. This decision, part of the provincial budget for the fiscal year 2024-25, aims to enhance revenue generation across various sectors, including hospitality and service industries.

 

Chief Minister Syed Murad Ali Shah highlighted the rationale behind the increase, emphasizing efforts to promote digital payments in the economy. "To promote digitalisation in the economy, it was proposed to reduce SST rate to 8% for restaurant services involving customers’ payments through digital means like debit/credit card, mobile wallet, QR Scanning, etc.," Shah explained during the budget presentation.

 

Under the revised tax structure, restaurants, cafes, bakeries, and hotels will now be subject to a 15% sales tax. Similarly, guest houses, farmhouses, clubs, and wedding halls will also fall under this increased tax rate.

 

In a move to incentivize digital transactions, credit card payments will attract an 8% sales tax, while cash payments will be taxed at the standard 15%. This dual-rate system is designed to encourage businesses and consumers to adopt electronic payment methods, thereby contributing to the formalization of the economy.

 

The budget announcement reflects the Sindh government's strategy to align fiscal policies with economic goals, ensuring sustainable revenue streams while supporting sectors hit by previous economic downturns. The increase in SST aims to bolster provincial finances amid ongoing challenges and economic reforms.
Tagged:

FiscalPolicy

SindhSalesTax

DigitalEconomy
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