GST on IT industry opposed -Pakistan Press Foundation (PPF)

Paksitan Press Foundtion

GST on IT industry opposed

ISLAMABAD – A meeting of the Inter-Provincial Co-ordination on Information Technology chaired by Federal Minister for Information Technology Awais Ahmad Khan Leghari here on Thursday described the proposed levy of General Sales Tax (GST) on the sale of IT hardware and software as detrimental.

“There is consensus between the federal IT ministry and IT departments of provinces that any decision to levy GST on IT hardware and software would prove detrimental to the growth of local IT industry, which is still infant and growing,” the minister said.

The meeting was also attended by Punjab IT Minister Haleem Khan, NWFP IT Minister Hussain Ahmad Kanju and Balochistan IT Minister Haji Matiullah Agha.

He informed the meeting that the mater had already been taken up with the finance ministry and he personally met the finance minister to convey growing anxiety felt by the IT industry in this regard.

He said he had recently met representatives of the Pakistan Software Houses Association (Psha) and Federation of Pakistan Chambers of Commerce and Industry (FPCCI) and they had also shown strong resentment and frustration over reports of imposition of GST on the IT industry in the upcoming budget,” he said.

He added, “the industry is still growing and yet to reach a stage where it can be brought into the GST fold.”

On the demand of provinces that IT institutes imparting education in every nook and corner be registered under an umbrella, the minister said he was personally against the concept as the exercise would lead to unnecessary interference and obstruction in the functioning of small street-based IT institutes.

However, he recommended that an awareness campaign be launched to educate parents investing heavy amounts in the IT education of their children from so-called degree-awarding institutions, whose degrees had no market value.

The minister also called for teaching of uniform IT diploma and certificate courses at the school and college level in all provinces to bring about a uniformity and credibility in the standard of IT education that needed to be aligned with the job market.

He said he had already written letters to all chief ministers sending them a working paper prepared by his ministry for the need to introduce IT education in poly-technical institutes to render all professional and vocational disciplines IT-enabled to add value to the industry.

He cited the example of Malaysia, which had achieved wonderful results by pumping a huge amount in the IT-enablement of the entire industry.

On the demand of provinces that the federal IT ministry should help them set up IT universities, Awais argued that his ministry did not have enough resources to fund such universities.

It, however, was willing to set up centres of excellence and support specialized training courses in selected institutions with sound human resource and research background.
Source: Business Recorder
Date:6/12/2004