Punjab, April 22, 2020: Punjab Revenue Authority (PRA) Has Exempted The Sales Tax On Construction services and services provided by contractors of building Till June 30, 2020.
PRA through a notification no.SO(TAX)1-110/2020 (COVID-19) has announced a relief package for the industries affected by the coronavirus (covid-19).
Zero percent sales tax on construction services and services provided by contractors of building (including water supply, gas supply and sanitary works), roads and bridges, electrical and mechanical works (including air conditioning), horticultural works, multi- discipline works (including turn-key projects) and similar other works but:
EXCLUDING:
(i) where the tax is otherwise paid by registered persons as property developers, builders or promoters for building construction; or
(ii) where the construction work is funded under an agreement of foreign grant-in-aid or involves construction of consular buildings; or
(iii) residential construction projects where the covered area does not exceed 10,000 square feet for a house and 20,000 square feet for an apartment except where construction services are provided to construct more than one house or more than one apartment building.
Explanation- Notwithstanding the rate of 5% fixed in column 4, the following further reduced rates shall be applicable:
(a) one per cent for all services specified at S.No.14 without input tax credit or adjustment to the extent of Government civil works including those of cantonment boards involved in the ongoing development schemes and projects launched during Financial Year 2016-17 and funded under the Annual Development Plan of the Punjab Government or funded through foreign loans where the negotiations were finalized after 1st of July 2016 or funded under Public Sector Development Program of the Federal Government or funded by the Cantonment Boards; and
(b) zero per cent for all services specified at S.No.14 without input tax credit/adjustment to the extent of Government civil works including those of cantonment boards involved in the ongoing development schemes and projects launched prior to Financial Year 2016-17 and funded under the Annual Development Plan of the Punjab Government or funded through foreign loans where the negotiations were finalized as on 1st of July 2016 or funded under Public Sector Development Program of the Federal Government or funded by Cantonment Boards.
