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Mobile app to be introduced for tax collection from restaurants


News Desk |

The Pakistan Tehreek-e-Insaf (PTI) government has decided to launch a mobile application for real-time collection of the general sales tax (GST) charged by restaurants and hotels across the country, tech portals reported.

The decision will be finalized after taking all the stakeholders on board. The application will send an instant receipt to the consumers to confirm that the tax has been collected. It will increase the government’s revenue from the sector.

Finance Ministry’s Recommendation to FBR

According to documents cited by a local publication, the Finance Ministry wrote a letter to the Federal Board of Revenue (FBR) in this regard following which, the latter decided to consider the recommendation for launching a mobile app for tax collection from hotels and restaurants.

The regional tax office of Islamabad, an institution functioning under the FBR, has installed a web-based restaurant invoice system throughout the city. In the Financial Year 2018-2019, the FBR posted a GST collection of Rs126,677 million.

The letter said that all luxury hotels and restaurants in the country collected GST in addition to their usual bills. Even the restaurants that do not provide computerized bills charged sales tax, the letter further read. “It is unconfirmed whether the tax, charged by hotels and restaurants, is actually deposited in the national treasury and within the prescribed time limit or not,” it added.

Furthermore, the app can be integrated with the tax mechanism so that the GST payments are made on a real-time basis. The system would greatly benefit the government by transfer of taxes to the national exchequer instantly.

Tax Transfer to the Treasury 

On the other hand, it would also ensure the consumers that their payment has entered the national treasury. The regional tax office of Islamabad, an institution functioning under the FBR, has installed a web-based restaurant invoice system throughout the city. In the Financial Year 2018-2019, the FBR posted a GST collection of Rs126,677 million.

Read more: Government gearing up to approve sweeping reforms in FBR

“Corroborated with the number of restaurants that exist in the provincial and federal capitals alone, the numbers are extremely low and most of the luxury restaurants that operate within these vicinities and charge taxes do so without proper NTN numbers, hence committing tax fraud,” sources from the tax collection agency told the Global Village Space.

Research & writing by Talha ul Huda with editing and additional inputs by Hammad Khan at the GVS News Desk.

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