New legislation passed by the National Assembly drastically raises penalties for hotels and restaurants in Islamabad, pushing certain fines up to 50 times their previous limits. The Senate approved the Pakistan Hotels and Restaurants (Amendment) Bill, 2026, on June 10, 2026, updating the 1976 version specifically for the Islamabad Capital Territory.

Hotels and restaurants missing the registration deadline face the steepest penalty change. The maximum fine jumps from Rs. 5,000 to Rs. 250,000, which marks a 50-fold increase. Furthermore, the daily fine for persisting with this violation goes from Rs. 1,000 to Rs. 10,000.

Old and New Fines

Several other violations also carry heavier financial penalties under the updated act.

  • Failure to apply for registration: Up to Rs. 250,000
  • Continuing failure to register: Up to Rs. 10,000 per day
  • Serving harmful or contaminated food or using contaminated utensils: Up to Rs. 10,000
  • Failure to follow an order or direction issued under the law: Up to Rs. 10,000
  • Charging above approved fair rates, first offence: Up to Rs. 10,000
  • Charging above approved fair rates, subsequent offence: Up to Rs. 20,000
  • Unregistered restaurant failing to comply with a directive: Up to Rs. 125,000
  • Unlicensed hotel or restaurant improperly advertising itself or using a star sign: Up to Rs. 10,000
  • Continuing improper advertising or use of star classification: Up to Rs. 2,000 per day

Future adjustments to these penalties can occur according to the Consumer Price Index or inflation, following prescribed rules.

Smaller Hotels Will Also Come Under Regulation

The updated bill alters the legal definition of a hotel. Previously, an establishment required at least 10 lettable bedrooms to qualify as a hotel. The amendment lowers this requirement to five rooms, bringing smaller accommodations in Islamabad into the regulatory framework.

Registration requirements now factor in earthquakes and environmental hazards. Additionally, departmental staff gain clear authority to seal premises, backed by local administration and police assistance.

The statement of objects and reasons explains that the changes update regulatory authority and revise penalties under the older law. The Senate Standing Committee stated that higher penalties create better deterrence and stricter compliance across tourism and hospitality. These changes affect only the Islamabad Capital Territory and do not apply nationwide.