Collection of Rs 40 Billion Garbage Tax Begins Across Punjab

LAHORE: The Punjab government has officially started the collection of Sanitation Fee / Garbage Tax in urban areas across the province under the Suthra Punjab Programme. The government expects to collect more than Rs 40 billion annually under this head. Apart from this, Rs 42 billion will be collected separately from property tax.

The responsibility for collecting this fee has been assigned to the Excise and Taxation Department. In this regard, a Service Level Agreement (SLA) was signed between the Suthra Punjab Authority and the Excise Department on September 21. DG Suthra Punjab Umer Javed and DG Excise Umer Sher Chattha had signed the agreement.

*Cabinet Decision:*

According to sources, the Punjab Cabinet had approved the uniform sanitation fee model in its 36th meeting on August 6. After the cabinet’s approval, the Local Government Department issued a formal notification, according to which this system is effective from July 1, 2026.

*How Much Will Be The Fee?*

The government has fixed separate rates for residential and commercial:

*Residential (Urban Areas):*
– Up to 5 Marla: Rs 300 per month (Rs 3,600 annually)
– 5 to 10 Marla: Rs 500 per month
– 10 to 20 Marla: Rs 1,000 per month
– 20 to 40 Marla: Rs 2,000 per month
– Above 40 Marla: Rs 5,000 per month (Applicable to large houses in Lahore DHA, Bahria)

*Commercial (Urban Areas):*
– Small business: Rs 500 per month
– Medium business: Rs 1,000 per month
– Large business / Factory / Shopping Mall: Rs 3,000 per month

*From How Many People Will It Be Collected?*

According to sources, the Excise Department has integrated data of more than 5 million commercial and residential properties with Suthra Punjab. The government expects to collect more than Rs 40 billion annually from this. Apart from this, Rs 42 billion will be collected separately from property tax.

In return for this collection, the Excise Department will be paid 1 percent of the total collection in advance as service charges.

*How Will The Bill Come?*

According to the procedure:

1. Bills will be printed by the Urban Unit and sent to the respective regions.
2. Through the concerned Directors, Circle Inspectors will go door-to-door to distribute the bills.
3. Excise will issue a combined annual bill along with property tax.
4. In the first phase, a combined bill for three months of July, August, September 2026 has been issued in October 2026, with the last date fixed as October 31.
5. Now online payment facility will also be available.
6. If the fee is not paid, NOC for purchase and sale of property will not be issued.

*Where Will It Not Apply?*

This agreement will not apply to Cantonment Boards, DHA, and private housing societies because they already have their own sanitation system. Slum areas and Katchi Abadis have also been exempted from it.

*Responsibility Given to Excise After Failure:*

According to sources, the Local Government and Municipal Corporations could not even collect 15 percent in the first quarter (July to September), after which this responsibility has been given to the Excise Department.

On the other hand, traders’ organizations in Rawalpindi and Lahore have started protesting against it, calling it double taxation. Traders say they are already paying a fee to the municipality under the head of conservancy charges.