Punjab Launches Major Crackdown on Hotels and Wedding Halls for Tax Evasion and Violations

The Punjab Revenue Authority (PRA) has launched a large-scale crackdown on hotels, restaurants, cafés, and wedding halls across the province to curb widespread tax evasion and enforce compliance with provincial laws.

According to officials, the campaign is being carried out simultaneously in Lahore, Rawalpindi, Sargodha, Bahawalpur, Vehari, and several other districts. PRA teams are inspecting business records, seizing documents, and reviewing tax deposits of establishments accused of underreporting revenue.

A senior PRA spokesperson said the drive aims to ensure all registered service providers are contributing their fair share to the provincial exchequer. “We have found multiple cases where businesses collected sales tax from customers but failed to deposit it in the government treasury,” the official stated.

Hotels and Wedding Halls Under Scrutiny

The crackdown primarily targets the hospitality and event management sectors, both of which play a major role in Punjab’s economy. Officials confirmed that several venues were found operating outside the province’s electronic Integrated Monitoring System (e-IMS)  a network designed to digitally record taxable transactions in real time.

Businesses that disconnected from the e-IMS have had their system connectivity suspended, effectively freezing their ability to conduct legal transactions until they regularize their operations. The PRA has also issued notices and initiated penalties against non-compliant establishments.

At the same time, the Punjab Marriage Functions Act 2016 is being strictly enforced by district administrations. Under this law, wedding functions must end by 10 p.m., and only a one-dish menu is permitted. Many wedding halls were found violating these rules, prompting joint inspections with local administrations.

“We are ensuring that both tax laws and marriage function regulations are implemented in full,” a district official said. “This is not just about revenue it’s about discipline and fairness in the system.”

Mixed Reactions from Business Owners

While many citizens have welcomed the action, some business owners have raised concerns over what they describe as an “aggressive approach.” A Lahore-based banquet hall manager said, “We understand the need for compliance, but the government should provide a clear timeline and guidance instead of surprise inspections. Small businesses are already struggling with high costs and low bookings.”

However, others support the campaign, saying it will promote fair competition. “Those who evade taxes gain an unfair advantage over compliant businesses,” said a restaurant owner in Rawalpindi. “This action should clean up the sector.”

Economic Impact and Next Steps

Experts believe the initiative could help increase tax collection and reduce Punjab’s fiscal gap if implemented consistently. The province’s service sector, particularly hospitality and events, remains largely informal and under-taxed.

Economic analyst Dr. Haroon Sheikh noted, “Such enforcement is necessary, but the government should also educate and assist small operators to adapt to digital systems like e-IMS. A balanced approach will ensure long-term compliance.”

The PRA has confirmed that inspections will continue over the coming weeks. Officials have warned that non-compliant venues could face sealing, fines, and legal proceedings if irregularities persist.

“Our message is simple  pay your dues and follow the rules,” the PRA spokesperson said. “This campaign is not against business, it’s against tax evasion.”

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