Calculaterix.comSites and calculators for every day
Pakistan, Khyber Pakhtunkhwa: telecommunication: 19.5% standard rate: 15% special and reduced rates: 10% 8% 6% 5% 4% 3% 2%
This page covers sales tax on services in Khyber Pakhtunkhwa. Pakistan's federal sales tax on goods is a separate tax.
Tax calculator needs two values. You can e.g. fill in tax % and price - and get price before tax as result. Price before tax and price are rounded.
You can also choose the tax % by clicking the percentage in the table below.
Pakistan, Khyber Pakhtunkhwa | |
| telecommunication | 19.5% Telecommunication services. |
| standard rate | 15% Most taxable services not qualifying for a concessionary rate. The 15% rate also applies to cash-paid restaurant and hotel services supplied by corporate-sector entities. |
| special and reduced rates | 10% Includes qualifying non-corporate restaurants and hotels where the 6% digital-payment rate does not apply, clubs, advertising, event-management and warehousing services, and specified non-corporate security and related services. 8% Specified services provided by non-corporate agents, including shipping and freight-forwarding, tour and travel, recruitment, insurance, commission and distribution agents. The 8% rate applies without input tax adjustment; corporate entities are generally subject to the standard rate. Customs agents and certain Hajj and Umrah services are instead subject to fixed charges. 6% Restaurant and hotel services paid through debit or credit cards, mobile wallets or QR scanning. The 6% digital-payment rate also applies to corporate-sector entities, generally without input tax adjustment. 5% Includes catering, most non-government construction services, IT and digital services, specified professional and consultancy services, beauty and fitness services, private laboratories, road passenger transport, ride-hailing and online marketplace services, and specified virtual-asset and digital trading platform services. Input tax adjustment is generally not allowed. 4% Qualifying government-funded and ADP construction and other projects, generally for projects approved on or after 1 July 2025. Specified social-welfare projects are exempt. Input tax adjustment is not allowed. 3% Specified property rental and leasing services, rental of utility meters, foreign exchange services and motor vehicle insurance. Input tax adjustment is not allowed. 2% Includes traditional dhabas, qualifying laundries and dry cleaners, specified medical and legal professional services, call centres, print-media advertising, and certain mining licence fees and royalties. The 2% rate also continues for qualifying government-funded projects approved between 1 July 2021 and 30 June 2025 under transitional rules. Input tax adjustment is generally not allowed. |
| exempt without deduction | Under the negative-list system, services are generally taxable unless specifically listed as non-taxable in the First Schedule or exempted by notification. Services not assigned a special rate in the Second Schedule generally fall under the standard rate. |
| reverse charge | Where a taxable service originates outside Pakistan and is received or consumed in Khyber Pakhtunkhwa, the recipient is liable to pay KP sales tax under the reverse-charge rules. |
| Past changes: | |
| 1 Jul 2026 | A 5% rate without input tax adjustment is introduced for specified virtual-asset and digital trading platform services. The definition and taxation of government-funded projects are revised: qualifying projects approved on or after 1 July 2025 are subject to 4%, specified social-welfare projects are exempt, and qualifying projects approved between 1 July 2021 and 30 June 2025 retain the transitional 2% rate subject to conditions. KPMG – A Brief of Provincial Tax Laws 2026 |
| 18 May 2026 | Healthcare exemptions are expanded to Sehat Sahulat services and government hospitals, while other health-related services become subject to 2% without input tax adjustment. The education exemption is extended to teachers, including visiting faculty, providing services to schools, colleges and universities. Khyber Pakhtunkhwa Finance Department – Gazette Notification No. BO(RES-II) FD/3-4/2026 |
| 1 Jul 2025 | Sales tax on government-funded construction projects, including ADP, PSDP and hydropower projects, increases from 2% to 4%, without input tax deduction. Qualifying older ADP projects retain transitional treatment. Khyber Pakhtunkhwa Finance Act 2025 – section 1(3), Second Schedule, Part II, item 11 |
| 1 Jul 2025 | Restaurant and hotel taxation is revised. A 6% rate applies where payment is made through debit or credit cards, mobile wallets or QR scanning. Qualifying non-corporate restaurants generally pay 10% on cash transactions, while corporate-sector entities remain subject to 15% on cash transactions. Khyber Pakhtunkhwa Revenue Authority – Finance Act 2025 |
| 1 Jul 2025 | A reduced 8% rate is introduced for specified services provided by non-corporate agents, including shipping and freight-forwarding, travel, recruitment, insurance, commission and distribution agents, without input tax adjustment. Corporate entities generally remain subject to the standard rate, while customs agents are subject to a fixed charge. Khyber Pakhtunkhwa Finance Act 2025 |
| 1 Jul 2025 | Khyber Pakhtunkhwa moves to a negative-list sales-tax regime: only services specifically listed in the First Schedule are non-taxable, while other services are generally taxable. Services not assigned a special rate in the Second Schedule are subject to the standard rate. Khyber Pakhtunkhwa Finance Act 2025 |
Note! The VAT information on this page is general information, not tax advice. The information is not exhaustive. VAT rules include many exceptions and special cases. Check the treatment of your situation in the tax administration's guidelines. The information was checked on 6 Oct 2026.
Pakistan, Balochistan | ||
| higher rate | 19.5% | |
| standard rate | 15% | |
| special and reduced rates | 10% 8% 6% 5% 4% 3% 2% 1% | |
Pakistan, Islamabad Capital Territory | ||
| standard rate | 15% | |
| reduced rate | 5% | |
https://www.fbr.gov.pk/Categ/The-Islamabad-Capital-Territory-Tax-on-Services-Ordinance-2001/771
Pakistan, Punjab | ||
| telecommunication | 19.5% | |
| standard rate | 16% | |
| special and reduced rates | 15% 8% 5% 3% | |
VAT rounding: the EU, the UK and other European countries
The EU VAT Directive and the Court of Justice of the European Union leave VAT rounding rules to be decided at national level. National rules vary. In the UK, HMRC allows VAT on B2B invoices to be rounded down to the nearest whole penny.
Roundings in VAT calculation: Mathematically impossible prices?
There are a whole range of VAT-inclusive prices that cannot be mathematically arrived at if the tax is calculated from the VAT-free price. One example is 3.99. These prices are also possible, but then the VAT-free price must be interpreted as rounded.
VAT Gap - How much VAT is left uncollected in EU countries?
9.5% of VAT was left uncollected in EU countries. See the list of EU countries and candidate countries.
In Europe there is VAT - in the US sales tax
In Europe, companies belonging to the production chain account for the VAT paid by the consumer to the state in proportion to their value added. The US sales tax, on the other hand, is billed entirely by the company that made the consumer sale. Sales tax is paid to local operators, not to the state.
Many of today's taxes were already in use in Antiquity. Deciding on taxation has moved from autocrats to parliaments and the level of taxation has risen. In earlier times taxes were used to wage wars, today taxes are used to maintain welfare states.
Calculaterix.comSites and calculators for every day