LAHORE – The Punjab government has proposed increasing the sales tax on restaurant transactions made through digital payment channels as part of the Punjab Finance Bill 2026.
Under the proposed changes, payments made through debit cards, credit cards, mobile wallets and QR codes would be taxed at 8pc, compared to the current rate of 5pc.
The bill also maintains a 16pc sales tax on transactions conducted through other payment methods.
Officials say the revised tax structure is aimed at increasing provincial revenue while continuing to encourage the use of documented payment channels in the restaurant sector.
If approved by the provincial assembly, the measure would make digitally paid dine-in and takeaway orders slightly more expensive, though they would still be subject to a lower tax rate than transactions made through non-digital means.
The existing 5pc rate was introduced to promote electronic payments and improve tax compliance. The proposed increase seeks to preserve the incentive for digital transactions while narrowing the gap between the two tax slabs.
The Punjab Finance Bill 2026 is currently under consideration and will require legislative approval before the revised rates can take effect.
