Significant progress has been made on the issue of sending tax notices to IT companies in Pakistan.
Negotiations between the Ministry of IT and Telecom (MoITandT) and the Federal Board of Revenue (FBR) regarding taxation of IT companies have been successful.
The federal government has decided to give relief to IT companies registered with the Pakistan Software Export Board (PSEB).
Caretaker Federal Minister IT Dr Umar Saif has said that FBR will not issue tax notices to IT companies registered with the Pakistan Software Export Board. According to the Caretaker Federal Minister, FBR has made changes in the system of tax notices. Tax notices will no longer be issued to IT companies registered with the Pakistan Software Export Board.
The facility of issuing tax notices to IT companies has been withdrawn from the individuals within the FBR responsible for issuing such notices. This step has been taken to prevent potential blackmail of IT companies.
According to Dr. Umar Saif, if this does not resolve the issue, then the IT sector can be declared non-taxable. This means that 0.25 percent will be deducted from IT companies but it will be counted in cess revenue or levy revenue. He stated that the FBR acknowledges the sensitivity of the matter, which is why it has agreed to provide this relief.
According to the caretaker federal minister, the IT industry has very little 0.25 % of the tax regime which was earlier zero percent. Tax documentation of the IT sector has become necessary due to FATF conditions.
But ever since this tax was introduced and IT companies came under the tax jurisdiction, the FBR began sending notices to them. This has led to a sense of disillusionment within the IT industry, prompting it to keep its funds outside the country.
Source: Pro Pakistani