ByIslamabad, Pakistan: The Ministry of Information Technology and Telecom has presented a series of proposals to the National Assembly aimed at stimulating the growth of Pakistan’s IT sector and attracting foreign investment.
Key Proposals:
- Tax Incentives: The ministry has proposed exempting taxes on the import of IT hardware and software essential for IT exports. Additionally, they have suggested extending the 100% tax credit for startups registered with the Pakistan Software Export Board (PSEB) to 2030.
- Simplified Tax Regime: The ministry has called for the simplification of tax procedures and the harmonization of tax definitions across federal and provincial levels. This includes exempting IT services from sales tax and clarifying the final tax regime for individuals using remittance services.
- Support for Freelancers: The ministry has proposed reducing the final tax rate for freelancers from 1% to 0.25% and exempting them from monthly sales tax returns and registration.
- Venture Capital Support: The ministry has recommended establishing a government-backed venture capital fund to provide financial support to startups and SMEs. Additionally, they have suggested incentivizing banks and venture capital firms to lend to the IT sector.
- Ease of Doing Business: The ministry has called for the establishment of facilitation desks at financial institutions to streamline processes for IT businesses and freelancers. They have also recommended expediting the issuance of corporate ESFCA debit cards and developing a foreign exchange portal.
By implementing these proposed measures, the government aims to create a more conducive environment for IT businesses, attract foreign investment, and position Pakistan as a leading technology hub in the region.
