Proposed tax on IT industry rejected
KARACHI – The standing committee on information technology of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has expressed serious concern over reports that the government is considering imposing 15 per cent sales tax on computer hardware and software in the budget for 2004-05 on the recommendation of the IMF.
The standing committee, whose members included the heads of all major IT industry organisations in the country, such as CSP, PASHA, ISPAK and the newly-formed Call Centre Association, as well as major multinationals like Intel, NCR, Oracle and Microsoft, has unanimously rejected the IMF-recommended levy on the hardware and software industry.
It would be detrimental to the future growth of the information technology sector in Pakistan, it said.
The committee felt that if GST was imposed, it would discourage new investors, increase the cost of end users, specially the government, and make the IT industry less competitive.
The meeting pointed out that almost all public and private sector organizations had prepared massive plans to invest in IT and improve infrastructure and processes.
However, it added, the additional cost due to the imposition of GST would severely impact on these investment plans.
Source: The News
Date:5/23/2004
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