The inconsistent tax regime and opening of foreign currency accounts are two major policy hurdles in promoting exports of the information technology sector said Federal Secretary for Ministry of Information Technology and Telecommunication Dr Muhammad Sohail Rajput.
The National Assembly Standing Committee on Information Technology and Telecommunication which met with Ali Khan Jadoon in the chair on Wednesday raised the matter that freelancers are facing serious problems in opening foreign currency accounts. He said that even politicians face immense difficulty in opening such accounts.
The secretary admitted that fact while saying that there are two major policy challenges including the inconsistent tax regime and opening foreign currency accounts, which hurt the IT and Telecom sector. He said that due to these challenges huge business is being lost. Bringing capital into and out of the country is also major a obstacle, he added.
The committee recommended calling the State Bank of Pakistan (SBP) and Federal Board of Revenue (FBR) officials in the meeting to discuss the matter and find some solutions.
The committee members raised questions about how India’s IT market is flourishing and how these challenges are being handled. The secretary said that India is twenty years ahead of Pakistan in this field, however, the country has the potential to catch up. India built a cyber-city, technology parks, and free tax zones for such purposes.
The secretary informed the committee that during the severe COVID-19 wave in India, most of the orders were missed and converted to Pakistan which resulted in IT sector exports growing by 47 percent from $1.4 billion in 2019-20 to $2.1 billion in 2020-21.
The committee recommended that there is a need for steps to dispel the fear and confusion over opening foreign currency accounts.
Source: Pro Pakistani