Rs10bn fund established for IT industry

Published August 11, 2021
The government will award five per cent rebate on IT exports. — AP/File
The government will award five per cent rebate on IT exports. — AP/File

ISLAMABAD: Minister for Finance Shaukat Tarin on Tuesday approved the establishment of a Rs10 billion fund for providing cash rewards to IT companies against their exports. The government will also award five per cent rebate on IT exports.

In a meeting with the association of software houses, the finance minister acknowledged that IT exports need to be enhanced. He assured that the government will provide all possible facilities to the sector.

Welcoming the decision of the finance minister the Pakistan Software Houses Association (P@SHA) expressed concerns over the attitude of the Federal Board of Revenue (FBR) and accused the tax collecting body of harassing the exporters and creating hurdles in the growth of IT sector in the country.

The delegation of P@SHA and the Pakistan Software Export Board (PSEB) held a meeting with the finance minister and apprised him of issues faced by the software houses and IT exports.

The delegation was led by P@SHA chairman Barkan Saeed and PSEB managing director Osman Nasir.

The meeting was briefed that rebate will be provided at the rate of 5pc of exports while 1pc of annual remittances by the IT sector would be allocated to PSEB every year to carry out skills development, capacity enhancement of IT companies, branding, marketing establishment of software technology parks across Pakistan.

It has been decided that the foreign companies will be allowed to repatriation of their profits.

Talking to Dawn, Mr Nasir said the decision will eventually help increase remittances from the IT services up to $3.5bn in the ongoing fiscal year against $2.1bn in 2020-21 only because the multinational companies do not bring back all the earnings back to the country.

“There are many expenditures and payments for the companies around the world but due to restrictions they do not remit the entire amount into Pakistan. Now it has been decided that the foreign companies can repatriate their profits to any foreign country,” he added.

The finance minister has also agreed that the “freelancers” will be allowed to open a special dollar account to receive payments for their individual IT exports.

“The industry needs up to 50,000 IT experts annually but we will never grow if the freelancers cannot operate in an open environment,” said Mr Saeed.

Published in Dawn, August 11th, 2021

Follow Dawn Business on Twitter, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

Wheat price crash
Updated 20 May, 2024

Wheat price crash

What the government has done to Punjab’s smallholder wheat growers by staying out of the market amid crashing prices is deplorable.
Afghan corruption
20 May, 2024

Afghan corruption

AMONGST the reasons that the Afghan Taliban marched into Kabul in August 2021 without any resistance to speak of ...
Volleyball triumph
20 May, 2024

Volleyball triumph

IN the last week, while Pakistan’s cricket team savoured a come-from-behind T20 series victory against Ireland,...
Border clashes
19 May, 2024

Border clashes

THE Pakistan-Afghanistan frontier has witnessed another series of flare-ups, this time in the Kurram tribal district...
Penalising the dutiful
19 May, 2024

Penalising the dutiful

DOES the government feel no remorse in burdening honest citizens with the cost of its own ineptitude? With the ...
Students in Kyrgyzstan
Updated 19 May, 2024

Students in Kyrgyzstan

The govt ought to take a direct approach comprising convincing communication with the students and Kyrgyz authorities.