ISLAMABAD: The Federal Board of Revenue (FBR) on Wednesday said there was no proposal under consideration to withdraw exemption available to income from exports of computer software or IT services or IT enabled services.

Under the current legal dispensation, the exports of computer software, IT Services or IT enabled services is exempt from tax as provided under clause (133) of Part-I of the Second Schedule to the Income Tax Ordinance 2001. This exemption is subject to condition that 80pc of the export earnings are remitted to Pakistan through normal banking channel. However, the persons claiming exemptions are subject to minimum tax on their turnover.

According to the FBR, there is a proposal to widen the scope of tax concessions available to income from the export of software, IT services and IT enabled services. For this purpose, the exemption is being shifted to tax credit regime.

It has been proposed that such income may be provided hundred percent tax credit against tax liability including minimum tax liability on their turnover. The proposal enhances the scope of concession to the IT sector, it added.

Update profile before 31st

Meanwhile, the FBR has urged all the taxpayers to update their profile before the deadline in order to avoid penal consequences under the law.

An official announcement said that statutory deadline for furnishing/updating of taxpayers’ profile under Section 114A of the Income Tax Ordinance-2001 is March 31, 2021.

Published in Dawn, March 11th, 2021