American Business Council Urges FBR to Maintain Tax Holiday on IT Exports

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American Business Council (ABC) of Pakistan has intended the Federal Board of

Revenue (FBR) have a tax holiday on exports of IT and IT-enabled assistance, as

withdrawal of freedom will dampen global tech companies with offices in Pakistan

to bring their money to the country. According to the budget proposals of the ABC

for 2021-22, the proposed removal of the tax holiday on exports of IT and IT-enabled

services in the finance bill shows the inconsistency of Government policies and

large organizations will find it very difficult to make any long term investments if

they believe that GoP is not working to compatible in its policies for the technology

sector. The Tax holiday is a key and only ground available to the The proposed

tax credit system is a complicated process that negates the Prime Minister’s vision

to improve the security of doing business in the country. It will result in tax officers

interpreting on a case-by-case basis, more paperwork, and eventually higher cost

for businesses which is extremely harmful. This will check global tech companies

with services in Pakistan to bring their money to the country to evade being taxed

hence having a direct impact on export numbers as well as payments, ABC

proposed.channels for transactions beyond a certain size e.g. Rs. 50,000. This will

enable FBR to have visibility into using patterns in the market, without having to go

through a real audit of the company. Otherwise, remove the requirement for

retaining a copy of CNIC from customers that make their activities electronically.

In 2018, the cabinet has approved the provision of cashback at 5% for IT and IT-

enabled services exporters duly verified and recognised by the state bank of Pakistan.

Source: https://propakistani.pk/2021/05/10/american-business-council-urges-fbr-to-maintain-tax-holiday-on-it-exports/

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