LAHORE: An increase in advance tax on marriage halls under an amendment to the Income Tax Ordinance 2001 has been challenged in the Lahore High Court.

Several owners of marriage halls, hotels, commercial lawns and clubs filed a joint petition through Advocate AK Dogar challenging the amendment to Section 236-D of the Income Tax Ordinance 2001 under Finance Act 2018.

The counsel pleaded that Article 18 of the Constitution guaranteed that every citizen had the right to conduct any lawful trade or business, and no law could be enacted to abridge or deny this fundamental right. He stated that the Supreme Court in a number of judgements had ruled that if any law was promulgated in derogation of fundamental rights it would be void because the executive was not empowered to frame a policy at the cost of fundamental rights guaranteed in the Constitution.

He contended that previously every person running a marriage hall, hotel or lawn was required to pay advance tax at the rate of five per cent of the bill under Section 236-D of the income tax law.

However, he says, this section had now been amended by introducing a proviso, which stated that the advance tax would be payable in big cities at the rate of Rs20,000 per event. Therefore, even if the bill is lower, the owner of a marriage hall would have to pay Rs20,000 per event. He argued that the advance tax could be legally payable on percentage basis and its amount could not be fixed.

Published in Dawn, August 11th, 2018