Karachi is set to introduce a new tax targeting hospitality and event-related businesses as the Karachi Metropolitan Corporation (KMC) moves forward with plans to implement an Entertainment Tax. The proposed levy is expected to apply to hotels, guest houses, lodges, marriage halls, marquees, marriage lawns, banquet facilities, and Airbnb accommodations operating within the city.
Under the proposal, a one percent tax will be charged on customer bills generated by these establishments. Municipal authorities believe the measure could help increase revenue while supporting tourism-related services and municipal development projects across Karachi.
According to KMC officials, the new tax is expected to be included in the upcoming municipal budget for approval. Municipal Commissioner Abrar Jaffar has invited public feedback on the proposal and announced that objections and suggestions from citizens will be heard during a public session scheduled for June 10 at the KMC headquarters.
Officials stated that the initiative is aimed at strengthening the financial position of KMC’s tourism department and improving the quality of services offered to residents and visitors. To facilitate the process, new bylaws related to the Entertainment Tax – City Tourism and Hospitality category are being incorporated into the existing tax framework.
The Municipal Commissioner emphasized that under the Sindh Local Government Act 2013, KMC has the authority to impose taxes, rates, tolls, and fees within its jurisdiction. Citizens and stakeholders wishing to challenge or comment on the proposal may submit their concerns to the office of the Senior Director Coordination at the KMC Building.
Meanwhile, opposition members in the City Council have reportedly begun consultations regarding the proposed tax. Political groups, including representatives from Jamaat-e-Islami, PTI, and other opposition parties, are expected to announce their position in the coming days.
Despite potential resistance from opposition members, sources suggest that the ruling PPP may have sufficient numbers in the council to secure approval of the measure.
