Sunday, June 12

Tax on clubs, farmhouses

For the first time, the Punjab government has levied duty ranging from 65 to 200 per cent on special classes of entertainment, separate cess on farm houses and clubs, while simultaneously increasing token tax on vehicles from Rs 500 to Rs 4500 depending upon the engine power.
As far as the duty on special classes of entertainment is concerned, 200 per cent of the payment for horse-racing or Rs 200 (whichever is higher) will be charged on admission tickets. Secondly, the proprietor of the Circus is to pay 20 per cent duty on the payment on admission, which will be on annual fixation basis. Thirdly, 65 per cent duty has been imposed on the entry tickets to fashion and musical shows or the same percentage of the total amount paid to the owner or management of the premises or total expenditure made by organiser or sponsor, whichever is higher.
However, no exemption in entertainment duty will be allowed to any of these entertainments under the Punjab Entertainment Duty Act 1958.
The rate of token tax for private vehicles was last revised in 2004. It was considered that since then the tax has lost its real value due to inflation, therefore, it has been proposed to rationalise the rate of token tax for private vehicles with engine capacity of 1000 CC or higher.
Vehicles with seating capacity of not more than three persons and capacity of less than six persons, the increase will be Rs 500. Vehicles with engine power not exceeding 1000 CC, Rs 600; power falling between 1000 CC and 1300 CC Rs 1800, between 1300 CC and 1500 CC Rs 3000, between 1500 CC and 2000 CC Rs 4500, between 2000 CC and 2500 CC Rs 6000 and with engine power exceeding 2500 CC an annual increase of Rs 10,000 has been made.
However, for three 4x4 vehicle with engine power exceeding 2500 CC, the increase is Rs 4500.
Houses or areas having swimming pools will be charged Rs 60,000 per annum as ‘Water conservancy charge’. However, this will not apply to educational institutions with a minimum surface area of 250 square feet.
For palatial farm houses constructed by affluent persons outside the urban rating areas, presently, no Property Tax is being charged from the owners of these farm houses. It has been decided to levy a fix farm house tax on three categories of farm houses having minimum area of four kanals and minimum covered area of 5,000 square feet. A farm house with covered area between 5000 to 7000 square feet, Rs 10 will be charged per square foot of the covered area. For a farm house with covered area between 7001 to 10,000 square feet, Rs15 per square foot of the covered area will be charged. Lastly, a farm house with covered area of more than 10,000 square feet, Rs.20 per square foot of the covered area will be charged. There are many elite clubs rendering services to affluent sections of the society.
The members of these clubs have capacity to pay cess for purposes of provision of education to poor and needy children. Ten per cent Education Cess on clubs’ initial membership fee and on services rendered by these clubs will charged.
As decreed by the government, ‘in order to make cinematic and amusement-park entertainment affordable to the common man’, the Entertainment Duty has been reduced from 65 to 20 per cent. While following into the footsteps of the Federal government and deeming ‘to give relief to the masses’, the General Sales Tax on Services is reduced from 17 to 16 per cent.

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