Islamabad, July 5, 2025 – In a dazzling move set to bring smiles across the beauty industry, the Federal Board of Revenue (FBR) has slashed the sales tax rate for beauty parlors operating in the heart of Pakistan—Islamabad.
The stunning relief follows amendments to the Islamabad Capital Territory (Tax on Services) Ordinance, 2001, officially updated after the passage of the Finance Act, 2025. This refreshing decision is expected to boost the beauty sector and offer significant financial ease to personal care providers in the federal capital.
According to FBR’s latest update, a standard 15% sales tax remains applicable on services offered by beauty parlors, slimming and body massage clinics, pedicure centers, and even cosmetic or plastic surgery facilities. However, the glamour fades for those whose annual turnover is below Rs.3.6 million or who do not have air-conditioning on the premises — such businesses remain exempt from the tax.
But here’s the real makeover: The FBR has introduced a glamorous 5% sales tax rate on personal care services provided by beauty parlors and related clinics, provided they forego any input tax adjustment or refund claims. This means while they benefit from a significantly reduced rate, they can’t offset other taxes—making this a double-edged but sparkling incentive.
For Islamabad’s vibrant and ever-growing beauty industry, this move could be a game-changer. With hundreds of parlors catering to the capital’s elite and everyday citizens alike, the lowered tax rate is expected to rejuvenate business activities, encourage compliance, and enhance customer affordability.
Industry insiders believe this tax relief adds much-needed allure to an industry that not only enhances external beauty but contributes significantly to Islamabad’s service economy.
In the glitzy world of personal care, this tax cut is being seen as a highlighter stroke by the FBR—subtle yet striking. As Islamabad’s beauty parlors gear up for post-budget transformations, the capital’s residents can look forward to more affordable pampering, one facial at a time.