Islamabad June 9 2022: Government of Pakistan continues to provide 100 percent tax credit on export income from IT and IT-enabled services till June 2025, reported by Ministry of Information Technology and Telecommunication today 9th June 2022.
The MoITT supports all credible private sector initiatives aimed at bolstering the local IT industry and attracting foreign investment. Government realizes that it has an important role in terms of providing a conducive environment to IT industry through infrastructure and HR development. Government’s incentives for IT industry includes 100 percent tax credit on export income from IT and IT-enabled services until 30th June, 2025 and 100 percent tax credit on profits and gains derived by the IT start-ups for the tax year in which a start-up is certified by Pakistan Software Export Board (PSEB) and for the next two years.
Moreover, Government allowed 100 percent equity ownership to foreign investors, 100 percent repatriation of capital and dividends allowed, and tax holiday for venture capital funds till 2024.
Focus remain on Growth Driven Financial Incentive on IT & ITeS export remittances. The main purpose of financial incentive scheme, is to encourage IT & ITeS export remittances through formal banking channels and improve reporting of export remittance receipts in correct IT & ITeS purpose codes, assigned by the State Bank of Pakistan. The government has allocated Rs. 4 billion to PSEB for the first ever financial incentive on IT & ITeS export remittances to be disbursed on the basis of export remittance receipts in FY2021.
According to the SBP data, IT exports during July-March FY2022 surged to US $1.948 billion at a growth rate of 29.26 percent in comparison to US $1.5 billion in the same period last year. These include telecommunication, computer and information services.
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