KARACHI: Pakistan can unlock billions in tech investment if it gives investors predictable taxes, friction-free remittances and a single digital compliance experience, the Pakistan Software Houses Association (P@SHA) said on Friday.
P@SHA said it presented a “Continuity & Consistency reform package” to the Ministry of Finance earlier this year, laying out a small number of high-impact changes that would slash compliance costs, bring tens of thousands of remote digital workers into the formal tax net, and catalyze both domestic and foreign investment into Pakistani tech firms.
The requested changes are not subsidies; they are predictability, digitalization, and administrative simplification. Most steps can be budget-neutral or revenue-positive once increased documentation, broadened compliance, and higher recorded export flows are taken into account.
“Every serious investor, local or international, asks the same two questions: What will my tax exposure be, and will the rules change after I invest?” P@SHA Chairman Sajjad Syed said.
“Right now, innovators spend too much time navigating overlapping regimes and too little time building export-earning products. If we hard-code continuity and make compliance near effortless, capital will move to Pakistan.”
Pakistan tech firms have been demonstrating their growing potential in the IT sector by showcasing their products and services at global forums, including the LEAP tech conference in Riyadh and GITEX global exhibition in Dubai.
Pakistan recorded monthly IT exports of $338 million in June, up by 14% year on year and by 3% month on month, according to Karachi-based Toplines Securities brokerage and market research firm. This took Pakistan’s annual IT exports to $3.8 billion, up by 18% YoY, in the outgoing fiscal year that ended in June.
In its statement, P@SHA urged continuation of the 10-Year Final Tax Regime (FTR) on information technology/IT-enabled services (IT/ITeS) export income, removal of discrepancies in tax rates where Pakistani IT companies get penalized for running payrolls from Pakistan, exemption of the Capital Gains Tax to secure investor’s confidence among other measures.
The association proposed joint working sessions with the Federal Board of Revenue, Ministry of IT & Telecom, State Bank of Pakistan, National Tax Council, and provincial revenue authorities to translate its proposed reforms package into draft language, digital filing flows, and phased rollout milestones, recommending immediate start of technical work.
“Pakistan stands at an inflection point: with its young talent base, global client footprint, and expanding startup ecosystem, the country can compete for high-value digital work, if investors trust the rules,” it said. “P@SHA urges policymakers to seize this moment to send that signal.”
