AZAD GOVERNMENT OF THE STATE OF JAMMU AND KASHMIR

LAW, JUSTICE AND PARLIAMENTARY AFFAIRS DEPARTMENT,

MUZAFFARABAD
Dated the 28th December, 2001
No. LD/Leg/1525-32/2001.The following Act of the Assembly
received the assent of the President on the 10th December,
2001 is hereby published for general information:-
(ACT XXIV OF 2001)
AN
ACT
to provide for levy of sales tax on services rendered or
provided in Azad Jammu and Kashmir
WHEREAS it is expedient to provide for levy of
sales tax on services rendered or provided in Azad
Jammu and Kashmir and for matters ancillary thereto or
connected therewith;
It is hereby enacted as follows:
1. Short title and commencement.- (1) This Act may
be called the Azad Jammu and Kashmir Sales Tax
(Tax on Services) Act, 2001.
(2) It extends to whole of the Azad Jammu and
Kashmir.
(3) It shall come into force at once and shall be
deemed to have taken effect on the 1st day of July,
2000.
2. Interpretation.- In this Act, unless there is
anything repugnant in the subject or context, the
words and expression used but not defined shall
have same meaning as in the Sales Tax Act, 1990;
3. Scope of Tax.- (1) Subject to the provisions of this
Act, there shall be charged, levied and paid a tax

493
 known as sales tax at the 1[rate specified in column
(4) of the schedule to this Act] of the value of the
taxable services rendered or provided in the Azad
Jammu and Kashmir.
(2) The tax shall be charged and levied on the
services specified in 2[column (2)] the schedule to
this Act in the same manner and at the same time,
as if it were a sales tax leviable under Section 3[xxx]
the Sales Tax Act, 1990.
4[“(2-A) The following provisions of sales tax Act,
1990, shall apply, mutatis mutandis, to the
services rendered or provided under this Act,
namely:-

1 subsection (1) of Sec. 3 amended four time. the original extract of

subsection (1) of Act XXIV of 2001 is reproduced as under:-
“(1) Subject to the provisions of this Act, there shall be charged, levied
and paid a tax known as sales tax at the rate of fifteen percent of the
value of the taxable services rendered or provided in the Azad Jammu
and Kashmir.”
A. In subsection (1) for the words “fifteen” the words “sixteen” subs. by the
AJ&K Finance Act, 2008 (Act VI of 2008) dt. 21.07.2008.
B. In subsection (1) of Sec. 3 for the words “sixteen” the words “seventeen”
subs. by the
C. In subsection (1) for the words “seventeen” the words “sixteen” subs. By
the AJ&K Finance Act, 2012 (Act I of 2012) dt. 10.07.2012.
D. In subsection (1) for the words “sixteen” the words “seventeen” subs. By
the AJ&K Finance Act, 2013 (Act I of 2013) dt. 06.08.2013.
E In subsection (1) for the words “rate of fifteen percent” the words “rate
specified in column (4) of the schedule to this Act” subs. By the AJ&K
Finance Act, 2015 (Act VI of 2015) dt. 14.07.2015.
2 Added by Ibid.
3 In subsection (2) the comma, figures and wards, “3, 3A or 3AA as the
case may be” omitted by the AJ&K Finance Act, 2008 (Act VI of 2008)
dt. 21.07.2008.
4 Added by the AJ&K Finance Act, 2016 (Act XXVI of 2016)
dt.02.08.2016.

494
 a) clause b of sub-section (2), sub-section (6)
and (7) of Section 3;
b) serial number 2, in column (1) and the
entries relating thereto of the fifth schedule
read with Section 4;
c) sub-section (2), (3), (6), and (7) of Section 13;
and
d) serial number 48, in column (1) and the
entries relating thereto of table-1 of sixth
schedule read with Section 13.
(2-B) The tax lived under sub-section (1) shall not
be applicable to regulatory and licensing services
rendered or provided by an organization
established by or under a Federal statues.”]
(3) All the provisions of the Sales Tax Act, 1990
and rules and notifications, orders, and
instructions issued thereunder shall, mutatis
mutandis, apply to the collection and payment of
tax under this Act in so far as they relate to-
(a) manner, time and mode of payment;
(b) registration and de-registration;
(c) keeping of records and audit;
(d) enforcement and adjudication;
(e) penalties and prosecution; and
(f) all other allied and ancillary matters.
1[“THE SCHEDULE

1 Schedule was subs./amended three time. The original extract of the

schedule is reproduced as under:-
“SCHEDULE

495
 1. Services provided or rendered by hotels, marriage halls, lawns
clubs and caterers:-
(a) Services provided or rendered by hotels;
(b) Services provided or rendered by marriages halls and lawns;
(c) Services provided or rendered by clubs; and
(d) Services provided or rendered by caterers.
2. Advertisement on T.V and radio excluding advertisement:-
(a) If sponsored by a Government Agency for health education;
(b) if sponsored by population welfare Division relating to Sathi
Educational promotion campaign funded by USAID; and
(c) Public Service messages if telecast on television by World
Wildlife Funds for Nature and UNICEF.
3. Services provided or rendered by persons authorized to transact
business on behalf of others:-
a) Customs agents;
b) Ship chandlers; and
c) Stevedores.
4. Courier Services.
5. Services provided or rendered for personal care by beauty parlours,
beauty clinics, and slimming clinics.
6. Services provided or rendered by laundries and dry cleaners.”
A. following amendments made bythe AJ&K Finance Act, 2008 (Act VI of
2008) dt. 21.07.2008:-
(i) Cl. (b) under serial No. 1 shall be omitted.
(ii) Serial No. 5 and 6 omitted.
B. The existing schedule subs. by the AJ&K Finance Act, 2015 (Act VI of
2015) dt. 14.07.2015as undere:-
“THE SCHEDULE
[See section 3(2)]
Pakistan
Custom
Rate of
S. # Description Tariff (PCT)
Tax
Heading if
applicable

496
(1) (2) (3) (4)
1 Services provided or rendered by 9801.1000
hotels, motels, guest houses, marriage
9801.3000
halls and lawns (by whatever name
called) including “pandal” and Sixteen
9801.4000
“shamiana” services, clubs including Percent
race clubs, and caterers. 9801.5000
9801.6000
2 Advertisement on television and radio,
excluding advertisements,-
(a) sponsored by an agency of
the Government of Pakistan
or Government for health
education;
(b) sponsored by the Population
Welfare Division relating to
educational promotion 9802.1000
campaign; Sixteen
and
Percent
(c) financed out of funds
9802.2000
provided by any of the
Government under grant-in-
aid agreement; and
(d) conveying public service
messages, if telecast on
television by the World Wide
Fund for Nature (WWF) or
United Nations Children’s
Fund (UNICEF)
3 Services provided by persons
authorized to transact business on 9805.2000
behalf of others,–
9805.4000 Sixteen
(a) stevedore; Percent
and
(b) customs agents; and
9805.8000
(c) chandlers
4 Courier Services and cargo services by 9808.0000 Sixteen
road provided by courier companies. Percent
9804.9000

497
5 Constructions services, excluding,-
(i) construction projects
(industrial and commercial)
of the value (excluding actual
and documented cost of land)
not exceeding Rs.50 million
per annum;
(ii) the cases where sales is
otherwise paid as property
developers or promoters;
(iii) Government civil works
including Cantonment 9824.0000
Boards; Sixteen
and
Percent
(iv) construction of industrial
9814.2000
zones, consular buildings
and other organizations
exempt from income tax;
(v) construction work under
international tenders against
foreign grants in aid;
(vi) Residential construction
projects where the covered
area does not exceed 10,000
square feet for houses and
20,000 square feet for
apartments
6 Services provided by property Rs.100 per
developers and promoters (including square
allied services) excluding the actual 9807.000 yard for
purchase value or documented cost of and land
land respective developme
sub- nt and
headings of Rs.50 per
heading square feet
98.14 for building
constructio
n

498
7 Services provided by persons engaged
in contractual execution of work,
excluding,-
(i) annual total value of the Sixteen
9809.0000
contractual works or supplies Percent
not exceeding Rs.50 million,-
(ii) the contract involving
printing or supplies of books.
8 Services provided for personal care by
beauty parlours, clinics and slimming
clinics, body massage centers,
pedicure centers; including cosmetic 9810.0000
and plastic surgery by such parlours /
clinics, but excluding,- 9821.4000 Sixteen
and Percent
(i) annual turnover not
exceeding Rs.3.6 million; or 9821.5000
(ii) the facility of air-conditioning
not installed or available in
the premises
9 Management consultancy services. 9815.4000 Sixteen
9819.9300 Percent

10 Services provided by freight Sixteen

forwarding agents, packers and percent or
movers
9805.3000 Rs.400 per
bill of
9819.1400
lading
whichever
is higher
11 Services provided by software or IT
Sixteen
based system development 9815.6000
Percent
consultants
12 Services provided by technical, Sixteen
9815.5000
scientific and engineering consultants Percent
13 Services provided by other
consultants including but not limited 9815.9000
to human resource and personnel Sixteen
9818.3000
development services; market Percent
research services and credit rating 9818.2000
services

499
14 Services provided by tour operators 9805.5100
and travel agents including all their Sixteen
9805.5000
allied services or facilities (other than Percent
Hajj and Umrah) 9803.9000
15 Manpower recruitment agents
Sixteen
including labour and manpower 9805.6000
Percent
supplies
16 Services provided by security agencies Sixteen
9818.1000
Percent
17 Services provided by advertising Sixteen
9805.7000
agents Percent
18 Share transfer or depository agents
including services provided through
manual or electronic book entry Sixteen
9805.9000
system used to record and maintain Percent
securities and to register the transfer
of shares, securities and derivatives
19 Business support services Sixteen
9805.9200
Percent
20 Services provided by fashion
designers, whether relating to textile,
leather, jewellery or other product Sixteen
9819.6000
regimes, including allied services, Percent
marketing, packing, delivery and
display etc.
21 Services provided by architects, town 9814.1000 Sixteen
planners and interior decorators Percent
9814.9000
22 Services provided in respect of rent-a- Sixteen
9819.3000
car. Percent
23 Services provided by specialized
workshops or undertakings (auto-
workshops; workshops for industrial
machinery, construction and earth-
moving machinery or other special Sixteen
98.20
purpose machinery etc; workshops for Percent
electric or electronic equipments or
appliances etc including computer
hardware; car washing or similar
service stations and other workshops).

500
24 Services provided for specified
purposes including fumigation,
services, maintenances and repair
(including building and equipment
Sixteen
maintenance and repair including 98.22
Percent
after sale services) or cleaning
services, janitorial services, dredging
or desilting services and other similar
services etc.
25 Services provided by underwriters, 9819.1100
indenters, commission agents
9819.1200
including brokers (other than stock)
and auctioneers Sixteen
9819.1300
Percent
and
9819.9100
26 Services provided by laboratories
other than services relating to Sixteen
98.17
pathological or diagnostic tests for Percent
patients.
27 Services provided by health clubs, 9821.1000
gyms, physical fitness centers, indoor
and Sixteen
sports and games centers and body or
sauna massage centers 9821.2000 Percent

9821.4000
28 Services provided by laundries and Sixteen
9811.0000
dry cleaners. Percent
29 Services provided by cable TV 9819.9000 Sixteen
operators. Technical analysis and
9819.9400 Percent
testing services.
30 Services provided by TV or radio
Sixteen
program producers or production --
Percent
houses.
31 Transportation through pipeline and Sixteen
--
conduit services. Percent
32 Fund and asset (including Sixteen
--
investment) management services Percent

501
 33 Services provided by Inland port
operators (including airports and dry
ports) and allied services provided at
ports and services provided by
Sixteen
terminal operators including services --
Percent
in respect of public bonded
warehouses, excluding the amounts
received by way of fee under any law
or by-law.
34 Technical inspection and certification
Sixteen
services and quality control --
Percent
(standards certification) services.
35 Erection, commissioning and Sixteen
--
installation services. Percent
36 Event management services Sixteen
--
Percent
37 Valuation services including
Sixteen
competency and eligibility testing --
Percent
services.
38 Exhibition or convention services. Sixteen
--
Percent
39 Services provided in respect of mining
Sixteen
of mineral, oil and gas including --
Percent
related surveys and allied activities
40 Services provided by property dealers Sixteen
--
and realtors. Percent
41 Call centers Eighteen
-- and a half
percent
42 Services provided by car / automobile Sixteen
--
dealers. Percent”]
C. following amendments made by the AJ&K Finance Act, 2018 (Act IV
of 2018) dt. 20.06.2018.
(i) Serial No.1 and entries relating thereto in column (2), (3) and
(4) subs.
(ii) a new Serial No. 1-A and entries relating thereto in columns
(2), (3) and (4) added.
(iii) against Serial No. 5, 8, 14, 23, 27, 28, 40 and 42, in column
(4), for the words “Sixteen Percent”, the words “Five Percent

502
[See section 3(2)]

Pakistan
Custom
S. Tariff (PCT)
Description Rate of Tax
Heading
if applicable

(1
(2) (3) (4)

1 Services provided or
9801.1000
rendered by hotels,
Sixteen
motels, guest houses 9801.4000
Percent
and clubs including
race clubs.

“1 Services provided or 9801.3000 Five

rendered by marriage Percent
halls, lawns (by 9801.5000
subject to

subject to the condition that no input tax adjustment or

refund shall be admissible” subs. and shall be deemed to
have been so substituted with effect from 25.05.2017.
(iv) against Serial No. 10, in column (4), for the words, figures
and expressions “Sixteen percent or Rs.400 per bill of lading
whichever is higher”, the words, figures and expression “Five
percent or Rs.1000/- per bill of lading whichever is higher
subject to the condition that no input tax adjustment or
refund shall be admissible” subs. and shall be deemed to
have been so substituted with effect from 25.05.2017.
(v) against Serial No. 5, in column (2), after cl. (vi), new cl. (vii)
added and shall be deemed to have been so added with effect
from 30.01.2018.
(vi) after Serial No. 5, new Serial No. 5-A, and entries relating
thereto in columns (2), (3) and (4) added and shall be
deemed to have been so added with effect from 30.01.2018.
(vii) after Serial No. 42, new serial no 43 and corresponding
entries in column (2), (3) and (4) added.

503
 whatever name 9801.6000 the
called) including condition
“pandal” and that no
“shamiana” services input tax
and caterers. adjustmen
t or refund
shall be
admissible
”

2 Advertisement on
television and radio,
excluding
advertisements,-
(a) sponsored by
an agency of
the
Government of
Pakistan or
Government
for health
9802.1000
education;
Sixteen
and
(b) sponsored by Percent
the Population 9802.2000
Welfare
Division
relating to
educational
promotion
campaign;
(c) financed out of
funds provided
by any of the
Government
under grant-in-

504
 aid agreement;
and
(d) conveying
public service
messages, if
telecast on
television by
the World Wide
Fund for
Nature (WWF)
or United
Nations
Children’s
Fund (UNICEF)

3 Services provided by
persons authorized
to transact business 9805.2000
on behalf of others,–
9805.4000 Sixteen
(a) stevedore; Percent
and
(b) customs
9805.8000
agents; and
(c) chandlers

4 Courier Services and

cargo services by 9808.0000 Sixteen
road provided by 9804.9000 Percent
courier companies.

5 Constructions Five
services, excluding,- 9824.0000 Percent
(i) construction and subject to
projects the
9814.2000 condition
(industrial and
commercial) of that no

505
 the value input tax
(excluding adjustmen
actual and t or refund
documented shall be
cost of land) admissible
not exceeding
Rs.50 million
per annum;
(ii) the cases
where sales is
otherwise paid
as property
developers or
promoters;
(iii) Government
civil works
including
Cantonment
Boards;
(iv) construction of
industrial
zones,
consular
buildings and
other
organizations
exempt from
income tax;
(v) construction
work under
international
tenders against
foreign grants
in aid;

506
 (vi) Residential
construction
projects where
the covered
area does not
exceed 10,000
square feet for
houses and
20,000 square
feet for
apartments
“(vii) Construction
Services for
hydro power
projects in
Azad Jammu
and Kashmir
under China
Pakistan
Economic
Coridoor
(CPEC)
arrangements
that shall be
charged to tax
under Serial
No. 5-A.”

“5 Construction One
Services for hydro Percent
power projects in 9824.0000 subject to
AJ&K under CPEC and the
arrangements. 9814.2000 condition
that no
input tax
adjustmen

507
 t or refund
shall be
admissible
.”

6 Services provided by Rs.100 per

property developers square
and promoters 9807.000 yard for
(including allied and land
services) excluding respective developme
the actual purchase nt and
value or documented sub- Rs.50 per
cost of land headings of square feet
heading for
98.14 building
constructio
n

7 Services provided by
persons engaged in
contractual execution
of work, excluding,-
(i) annual total
value of the
Sixteen
contractual works or 9809.0000
Percent
supplies not
exceeding Rs.50
million,-
(ii) the contract
involving printing or
supplies of books.

8 Services provided for 9810.0000 Five

personal care by Percent
9821.4000
beauty parlours, subject to
clinics and slimming and the

508
 clinics, body massage 9821.5000 condition
centers, pedicure that no
centers; including input tax
cosmetic and plastic adjustmen
surgery by such t or refund
parlours / clinics, shall be
but excluding,- admissible
(i) annual
turnover not
exceeding
Rs.3.6 million;
or
(ii) the facility of
air-
conditioning
not installed or
available in the
premises

9 Management 9815.4000 Sixteen

consultancy
9819.9300 Percent
services.

1 Services provided by Five

freight forwarding percent or
agents, packers and Rs.1000/-
movers per bill of
lading
9805.3000 whichever
is higher
9819.1400
subject to
the
condition
that no
input tax
adjustmen

509
 t or refund
shall be
admissible

1 Services provided by
software or IT based Sixteen
9815.6000
system development Percent
consultants

1 Services provided by
technical, scientific Sixteen
9815.5000
and engineering Percent
consultants

1 Services provided by
other consultants
including but not
limited to human 9815.9000
resource and Sixteen
9818.3000
personnel Percent
development 9818.2000
services; market
research services and
credit rating services

1 Services provided by Five

tour operators and Percent
travel agents subject to
including all their the
9805.5100
allied services or condition
facilities (other than 9805.5000 that no
Hajj and Umrah) input tax
9803.9000
adjustmen
t or refund
shall be
admissible

510
1 Manpower
recruitment agents Sixteen
9805.6000
including labour and Percent
manpower supplies

1 Services provided by Sixteen

9818.1000
security agencies Percent

1 Services provided by Sixteen

9805.7000
advertising agents Percent

1 Share transfer or
depository agents
including services
provided through
manual or electronic
book entry system Sixteen
9805.9000
used to record and Percent
maintain securities
and to register the
transfer of shares,
securities and
derivatives

1 Business support Sixteen

9805.9200
services Percent

2 Services provided by
fashion designers,
whether relating to
textile, leather, Sixteen
jewellery or other 9819.6000
Percent
product regimes,
including allied
services, marketing,
packing, delivery and

511
 display etc.

2 Services provided by
architects, town 9814.1000 Sixteen
planners and interior 9814.9000 Percent
decorators

2 Services provided in Sixteen

9819.3000
respect of rent-a-car. Percent

2 Services provided by
specialized
workshops or
undertakings (auto-
workshops;
workshops for Five
industrial machinery, Percent
construction and subject to
earth-moving the
machinery or other condition
special purpose 98.20 that no
machinery etc; input tax
workshops for adjustmen
electric or electronic t or refund
equipments or shall be
appliances etc admissible
including computer
hardware; car
washing or similar
service stations and
other workshops).

2 Services provided for

specified purposes Sixteen
including fumigation, 98.22
Percent
services,
maintenances and

512
 repair (including
building and
equipment
maintenance and
repair including after
sale services) or
cleaning services,
janitorial services,
dredging or desilting
services and other
similar services etc.

2 Services provided by 9819.1100

underwriters,
9819.1200
indenters,
Sixteen
commission agents 9819.1300
Percent
including brokers
and
(other than stock)
and auctioneers 9819.9100

2 Services provided by
laboratories other
than services relating Sixteen
98.17
to pathological or Percent
diagnostic tests for
patients.

2 Services provided by Five

health clubs, gyms, Percent
physical fitness 9821.1000 subject to
centers, indoor the
and
sports and games condition
centers and body or 9821.2000 that no
sauna massage input tax
9821.4000
centers adjustmen
t or refund
shall be

513
 admissible

2 Services provided by Five

laundries and dry Percent
cleaners. subject to
the
condition
9811.0000 that no
input tax
adjustmen
t or refund
shall be
admissible

2 Services provided by
cable TV operators. 9819.9000 Sixteen
Technical analysis 9819.9400 Percent
and testing services.

3 Services provided by
TV or radio program Sixteen
--
producers or Percent
production houses.

3 Transportation
Sixteen
through pipeline and --
Percent
conduit services.

3 Fund and asset

(including Sixteen
--
investment) Percent
management services

3 Services provided by
Inland port operators Sixteen
--
(including airports Percent
and dry ports) and

514
 allied services
provided at ports and
services provided by
terminal operators
including services in
respect of public
bonded warehouses,
excluding the
amounts received by
way of fee under any
law or by-law.

3 Technical inspection
and certification
Sixteen
services and quality --
Percent
control (standards
certification) services.

3 Erection,
Sixteen
commissioning and --
Percent
installation services.

3 Event management Sixteen

--
services Percent

3 Valuation services
including
Sixteen
competency and --
Percent
eligibility testing
services.

3 Exhibition or Sixteen
--
convention services. Percent

3 Services provided in Sixteen

respect of mining of --
Percent
mineral, oil and gas

515
 including related
surveys and allied
activities

4 Services provided by Five

property dealers and Percent
realtors. subject to
the
condition
-- that no
input tax
adjustmen
t or refund
shall be
admissible

4 Call centers Eighteen

-- and a half
percent

4 Services provided by Five

car / automobile Percent
dealers. subject to
the
condition
-- that no
input tax
adjustmen
t or refund
shall be
admissible

4 Telecommunication 98.12 Ninteen

Services and a half
(all sub-
headings) percent”

516
3. Repeal.- The Azad Jammu and Kashmir Sales Tax
(Tax on Services) Ordinance, 2001 (Ordinance XLVI
of 2001) is hereby repealed.

Sd/-(Irshad Ahmed
Qureshi)
Deputy Secretary

517