The government has suggested reducing the tax rate on credit card payments for restaurant services in Islamabad. Currently, the tax rate is 15 percent, but the proposal aims to lower it to 5 percent.
The reduced tax rate would apply to various food service outlets such as restaurants, cafes, coffee houses, food parlors, and more. This includes establishments that offer cooked, prepared, or ready-to-eat food, including ice cream.
Under the proposal, if customers make payments through debit or credit cards, mobile wallets, or QR scanning, they would only be charged a 5 percent tax. However, this would not allow for any adjustment or refund of input tax.
On the other hand, a 15 percent tax rate has been suggested for services provided by hotels, motels, guest homes, farmhouses, marriage halls, lawns, clubs, and caterers.
