Karachi : Convener of the FPCCI Standing Committee on IT, known IT exporter and Chief of Viper Group, Khushnood Aftab, has lauded the Federal Finance Minister for laying emphasis on the development of the IT sector.
He said that the Finance Minister recognizing the importance of the IT industry and focusing on digitizing Pakistan’s economy is a very positive sign.
Speaking to the business community, he stated that the Finance Bill 2024 contains several measures that will affect Pakistan’s IT sector that require correction.
Khushnood Aftab said that the tax burden has been increased on salaried employees, especially those earning Rs 50,000 or more per month. Such measures could lead to the migration of talent and skilled professionals to other countries.
He added that individuals will look for opportunities abroad to avoid high taxes, which will reduce the capacity for innovation and growth in the local IT sector.
He stated that the hike in the tax on IT hardware from 5 percent to 10 percent will raise the cost of technology in this industry, thereby driving up the production costs of IT companies.
Mr. Aftab emphasized that high business costs will hinder local companies’ ability to compete both locally and internationally, and the current 18% tax on assembly parts discourages local assembly.
This decision will increase dependence on imported assembled products, decreasing local manufacturing and employment opportunities, he said.
He added that despite the budget’s allocation of 79 billion rupees for government projects and IT parks, which is a good thing, these projects do not prioritize the private sector.
While the involvement of private sector will remain limited, it will also limit innovation and efficiency, he said, adding that private sector involvement is critical to developing a vibrant and competitive IT system.
The government should announce tax relief and incentives for professionals to benefit the best minds and talented youth in the country.
The government will establish IT parks through public-private partnerships, which will bring much-needed investment to this promising sector.
He emphasized that by making IT parks more dynamic and growth-friendly, we can compete in the global market by retaining talent.
