Demand for tax holiday to IT industry not honored; Chairman P@SHA

by index360

LAHORE: Muhammad Zohaib Khan, Chairman of Pakistan Software Houses Association (P@SHA), has apprised that while the IT industry acknowledges the fact that the industry has been prioritized in the federal budget 2023–24; but, on the other hand, these measures may prove to be inconsistent, unreliable and suffer lack of implementation – as happened with the past many budgets and IT export promotion or incentives schemes.

The real issue is the consistency of policies; which may not be achieved with the change in the government, he added.

Khan added that, for the aforementioned reason, we have unequivocally and vociferously demanded the government and the state institutions to provide a guarantee of 15 years that the policies will not change; only than we can make strategic investments; attract foreign direct investment (FDI) and establish joint ventures with the multinationals.

One of the key demands of the IT industry was not met, i.e. a tax holiday for a period of 10 years to realize the IT exports potential of $15 billion within the upcoming 5 years and $30 billion in 10 years time-frame.

Khan added that, at a time, when confidence of the domestic or foreign businessmen in Pakistan’s economic conditions is at an all-time low because of high-level of political and economic uncertainty, super tax has been withdrawn for the export-oriented companies; but, still companies are sent notices, they are harassed and their bank accounts are held.

Khan stressed that inclusion of IT & ITeS companies SMEs through extending its limit to PKR. 800 million is a positive; however, on the other side, 6 percent super tax on a company with PKR. 150 million profitability neutralizes the incentive.

P@SHA Chairman appreciated the introduction of the scheme for skills development of 50,000 IT graduates in the budget FY24. This can be a game-changer if implemented across Pakistan equitably and productively, he added.

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