Pakistan has the opportunity to unlock billions in technology investments—both domestic and foreign—by addressing the core concerns of investors: stable tax policies, streamlined remittances, and a unified digital compliance system. The Pakistan Software Houses Association (P@SHA) has formally called on the Government of Pakistan to establish a long-term, consistent tax and regulatory framework tailored to the country’s technology and IT-enabled services (ITeS) sector.

P@SHA has submitted its Continuity & Consistency reform package to the Ministry of Finance in advance of the Finance Bill, presenting a series of targeted reforms that could significantly reduce compliance burdens, formalize thousands of remote digital workers, and attract substantial new capital into the tech ecosystem.

“Every serious investor, whether local or foreign, always asks two key questions: What will my tax exposure be, and will the rules change after I invest?” stated P@SHA’s Chairman. The current environment, burdened by overlapping regimes and administrative hurdles, is diverting innovators’ time away from product development and towards navigating compliance.

To solve this, P@SHA’s proposed reforms include the following priority actions:

• Extend the 10-Year Final Tax Regime (FTR) on IT/ITeS export income.

• Address disparities in tax treatment that disadvantage IT firms running payrolls from Pakistan.

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• Launch a Roshan-Digital-style remittance system for IT exporters to ensure fast foreign currency (FCY) receipts, transparent conversion, and seamless integration with the Federal Board of Revenue (FBR).

• Rationalize the Super Tax (Section 4C) for the IT sector under FTR.

• Exempt Capital Gains Tax to build investor confidence.

• Unify provincial sales tax filings into a single, creditable return mechanism through the National Tax Council.

• Consolidate duplicative labour levies (EOBI, SESSI, PWWF) through a central digital window specifically designed for knowledge workers.

Importantly, these changes are not demands for subsidies. Instead, they emphasize predictability, digitization, and administrative streamlining. According to P@SHA, many of the reforms could be budget-neutral or even revenue-positive due to enhanced documentation, broader compliance, and increased recorded export flows.

To fast-track implementation, P@SHA has suggested forming joint working groups with the FBR, Ministry of IT & Telecom, State Bank of Pakistan, National Tax Council, and provincial authorities. These groups would collaborate on drafting the language, designing digital filing systems, and defining phased rollout plans—ideally aligned with the upcoming Finance Bill.

Pakistan, with its youthful talent pool, global clientele, and rising startup culture, is well-positioned to become a hub for high-value digital services. But that will only happen if policymakers can deliver the clarity and confidence that investors seek. P@SHA urges the government to act decisively and embed these reforms into law—securing Pakistan’s digital future.