Sindh to cut sales tax on IT and software from 13% to 3%

The Sindh government is ready to give tax relief to the IT industry by reducing the Sindh sales tax on IT, software and call centers from 13% to 3%, while an IT policy over five years will also be unveiled shortly.

It was announced by Chief Minister (CM) Syed Murad Ali Shah on Monday during a seminar titled Ease of Doing Business for the IT/ITeS Industry. The Federal Minister of Information Technology also spoke at the seminar organized by the Department of Information Science and Technology of Sindh in collaboration with Pakistan Software Export Board (PSEB) and PASHA.

The CM said relief for the IT industry would be announced in the budget speech on Tuesday, in which the rate of Sindh’s sales tax on IT, software and call centers would be reduced by 13 % to 3% with no input tax credit. However, larger establishments that prefer the standard rate with input tax credit will have the option of 13% with input tax credit facilities.

Murad said his government is committed to facilitating the IT sector by providing tax and non-tax incentives and projects to improve Sindh’s IT exports through policy interventions and procurement regulations to promote the use of local IT solutions.

He said that the Sindh government is planning to roll out enabling IT infrastructure across the province with the help of PSEB as it is also in the process of adopting Sindh’s first “cloud first policy” which would be unveiled in the first quarter of fiscal year 2022-23.

The policy would promote coordination with the federal government for broadband for all, to expand software and IT assets, and to incentivize cloud services for government cloud adoption to provide cost-effective services to start-ups and enterprises. computers, he said.

The Sindh government, he said, had planned to launch several skill building programs in the next fiscal year, including high-end boot camps for youths, skill building for teachers and Trainers, Digital Literacy for Primary and Secondary Schools, Skills Program for Girls and Skills and Self-Employment Programs for People with Disabilities.

In order to rethink existing government processes and introduce innovative citizen services for youth engagement, the Government of Sindh was focusing on different programs including “Promoting Startup Culture through Incubators and Accelerators” , private equity (PE) and venture capital (VC) financing, and initiation of start-ups into government operations or services and special incentives for women-owned start-ups, a-t -he adds.

Talking about e-governance, CM said that automation of government operations is a fundamental element for effective and efficient governance and that Sindh has already taken initiatives for establishment of Sindh digital council, automation of operations government services, online government services for citizens and businesses, and Ongoing Citizen Awareness of Opportunities and Threats.

Moreover, he said, his government had decided to rely heavily on the use of technology and had planned technology intervention programs in targeted areas of health, agriculture, education and empowerment of women. “The government of Sindh wants to leapfrog in the use of digital technologies and overcome the existing challenges in providing basic services to citizens,” he said.

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