The current prime minister of Pakistan, Mr. Shahid Khaqan Abbasi, just announced an extension of 6 years in the tax exemption period for IT exports. The tax holiday has just been extended for a significant six years, till the year 2025. The decision is said to have been made to promote and encourage technological advancement in the country and to help promote digital startups and ventures in Pakistan.

This important announcement was made at the inauguration of the National Incubation Center (NIC) at NED University, in Karachi this past Friday. The Prime Minister received huge appreciation for his announcement regarding tax relief, from the stakeholders present.

Significant incentives were also announced for the IT industry, which include a 5% cash reward on exports, loan exemptions for IT companies, and 5% sales tax on IT products in federal areas including Islamabad. It’s important to note here, that for now, these exemptions are only available to companies whose area of operation is in Islamabad and other federally administered areas.

“Loans will be given at low rates and will require less collateral; tech special economic zones will also be built to facilitate the sector…” said the PM

Moreover, banks have also been instructed by the State Bank of Pakistan to provide loan reliefs and preferential financing services to IT companies in Pakistan.

The PM also announced building Special Economic Zones (SEZs) for the tech sector which will be identified by the BOI and MoITT. He also indicated the possibility of technology parks being established in major cities of the country.