Tribal districts exempted from sales tax

The relief will be effective for four months

PESHAWAR:

Khyber-Pakhtunkhwa Revenue Authority (KPRA) has taken a significant step to support the tribal and semi-tribal districts by exempting them from sales tax for a duration of four months.

According to the notification issued under the Khyber Pakhtunkhwa Sales Tax on Services Act 2022, the erstwhile federal and provincial tribal districts will benefit from this exemption. The exemptions were decided by the Authority’s Policy Board with the approval of the provincial government.

As per the notification, sales tax will not be applicable to the provision of services within these districts. This exemption will specifically apply to services provided to residents of these areas and businesses located within their boundaries.

However, it’s essential to note that telecommunications, other allied services, and projects under the Public Sector Development Program (PSDP) and Annual Development Program (ADP) will not be eligible for this sales tax exemption. The new sales tax exemption will be effective from July 1, 2023, and will remain in effect until October 31, 2023.

It’s worth mentioning that during the merger of ex-Fata with K-P, the federal government had previously granted a five-year tax exemption to these regions. As the five-year period expired in June this year, the government has now taken the decision to extend the exemption for an additional two years.

The residents of the tribal districts have been grappling with the aftermath of militancy and terrorism, which has left their economy in shambles. Many have been forced to leave their homes and migrate to other parts of the country.

Published in The Express Tribune, July 28^th, 2023.