Rationalization of tax structure: Computer industry will present case before FBR management

ISLAMABAD: The computer industry will present their case before the new management of the Federal Board of Revenue (FBR) for rationalization of the tax structure on the computer items/inputs including zero-rating of all stages for encouraging investment in local assembling and domestic sales.

In this regard, tax authorities will interact with the Pakistan Computer Association (PCA) to hear their viewpoint during current business environment under existing duties and taxes structure on computers and related items.

The PCA officials said that the new anti-smuggling policy of the FBR must address the concerns of genuine and documented vendors of the industry through accurate valuation rulings and assessments at the import stage.

Muhammad Khawar, former Senior Vice chairman PCA said that the Information Technology (IT) industry in Pakistan has tremendous potential to capture emerging global markets. However, facilitation to local industry would play a key role in the growth of the sector and to contribute in national economy. “The tax related exemptions and facilitation to Pakistani IT industry could play a vital role in the revival of the sector, especially in after Covid19 scenario,” Muhammad Khawar said and added further that we need to address some anomalies in the policy towards IT sector that were still hurting the industry, especially with regard to local assembling.

While appreciating the government for acknowledging IT sector as a key actor in the national economic growth, he explained that the exemption announced by the government on imports of same equipment that is used in the manufacturing of laptops was still not applicable. Hence, assembling at local level was not viable and resulting as closer of the industry and thus increased joblessness.

He urged the government to take measures so facilitate the local industry and enable it to train the workforce that could serve various international companies. He added further that raw material and inputs should be zero-rated at all stages of the product life-cycle to boost the assembling at local level, which would be hugely beneficial for end users, especially youth besides a contribution in national exchequer.

Muhammad Khawar suggested that the industry representatives should be consulted by FBR in ascertaining real percussions of existing policies for the industry so that proper remedial step could be suggested and taken accordingly. He said that we need to take proactive approach to welcome international investments in Pakistan in IT sector to create more jobs and use the potential of youth to boost national economy.

Copyright Business Recorder, 2020