P@SHA · Pakistan IT Industry Association Policy Portal
The record

Advocacy wins

Outcomes secured through P@SHA's engagement with federal ministries, regulators, and parliament, grouped by the fronts where the industry's operating environment is decided.

6
Formal budget recommendations submitted
2
Acted on in the Finance Bill 2026-27
9
Further fiscal wins beyond the formal asks
7
Connectivity, banking & payments wins
1-on-1
Member cases resolved: EOBI, PTA, banking
I

The formal asks: recommended and delivered

P@SHA's Federal Budget 2026-27 Policy Recommendations (April 2026) put six formal interventions before the FBR, Ministry of Finance, and MoITT. Where each one stands after the Finance Bill:

3 yearssecured
Extension of the 0.25% Final Tax Regime Partially delivered

Recommended: extend the FTR under Section 154A for a minimum of 5 years, preferably 10. Delivered: extended through Tax Year 2029, three years of policy certainty. The push to convert this into a permanent statutory benefit continues into the 2029 review cycle.

Rs. 5.29Ballocated
National skills programs budget allocation Delivered

Recommended: a dedicated PKR 5 billion federal allocation for national digital skills programs. Delivered: Rs. 5.29B for digital skills targeting 120,000 youth, within over Rs. 10B committed across skills, education, and AI. P@SHA is now pursuing the joint industry governance and outcomes-based funding design it proposed.

Carriedhigh priority
Tax classification: independent exporters vs remote employees Not addressed

Recommended: a Category A / Category B distinction under Section 154A with graduated rates, closing a 22 to 44 percent take-home pay arbitrage draining senior talent from organized IT firms. The Bill extended the rate uniformly. This remains P@SHA's top ask for the next cycle.

Carriedforward
Capital gains & repatriation relaxation for venture capital Not addressed

Recommended: pass-through treatment for licensed VC/PE funds, capital gains exemption for 3+ year holds in PSEB-registered companies, and repatriation guarantees. Not included in the Bill; the most consequential omission given VC investment fell from $366M in 2021 to $22.5M in 2024.

Carriedforward
Made in Pakistan: public sector IT procurement mandates Not addressed

Recommended: minimum allocation thresholds for locally developed software and hardware in federal and provincial procurement, with phased implementation. Not taken up in this Bill; advocacy continues with MoITT and PSEB.

Carriedforward
Harmonization of provincial sales tax on domestic IT services Not addressed

Recommended: a unified 5% rate, single registration, and single-portal filing through the CCI or National Tax Council. A federal-provincial matter beyond the Finance Bill alone; P@SHA continues to pursue the coordination mechanism.

I-B

Beyond the formal asks: further budget wins

Delivered in the Finance Bill following P@SHA's wider budget engagement: Standing Committee testimony, consolidated industry feedback through FPCCI and the Ministry of Finance, and the post-budget anomaly process.

90%tax cut
Overseas card transaction tax reduced from 5% to 0.5%

Direct cost relief on every payment for cloud, tools, and SaaS made through Pakistani bank-issued cards.

100%cash upfront
Startup withholding exemption under Clause 43F

Ends the refund-cycle working capital squeeze for qualifying early-stage companies.

Rs. 511Kmax annual saving
Salaried IT tax relief across all brackets

Surcharge abolished and thresholds restructured, improving talent retention at zero cost to employers.

Rs. 500Msuper tax exemption
Super tax threshold raised from Rs. 150M, rate cut to 8%

A company earning Rs. 200M that previously paid Rs. 5M in super tax now pays nothing, freeing capital for reinvestment.

CVTabolished
Capital Value Tax on foreign assets removed

Eliminates a friction point affecting founders' and professionals' decisions about where to domicile assets.

10%new tax credit
New tax credit for FBR system integration

Covers hardware, software, and installation costs, incentivizing the digital compliance infrastructure the sector needs.

Preservedpreferential treatment
Sector's preferential tax treatments protected

WHT on IT services held at the preferential 4% rate, and the Section 65F technology tax credit continued into the new fiscal year. Defending existing benefits through each budget cycle is as much a part of advocacy as winning new ones.

II

Connectivity & digital access

Secured through engagement with PTA, including Senate hearings, industry-wide surveys, and direct facilitation for affected members.

350+companies
IP addresses whitelisted for member companies

Restored reliable connectivity for hundreds of exporting firms during a period of network disruption.

20VPNs
VPN whitelisting secured, with member cases resolved

Whitelisting of 20 VPNs alongside case-by-case resolution and facilitation for member companies, a member webinar on the whitelisting process, and the Chairman's testimony before the Senate.

Publicposition
Industry statement on the internet firewall

P@SHA put the industry's position on record on connectivity disruptions and their export impact.

III

Banking & payments

Secured through P@SHA's standing engagement with the State Bank of Pakistan on facilitation for IT and ITES exporters.

RevisedSBP policy
Equity Investment Abroad policy revised

Expanded room for Pakistani IT companies to invest in and operate international subsidiaries.

$25K+threshold raised
Form R requirements simplified

SBP's 2026 instructions raised the Form R threshold above USD 25,000 and removed the per-transaction requirement, following sustained industry feedback on documentation burden. Bank-level implementation is being tracked in Live Issues.

Concludedvendor list
Additions to the approved overseas and digital vendors list

Industry-proposed vendors added, easing routine payments for international services.

Deliveredto SBP
Prioritized list of digital banking facilities

A consolidated industry requirement set for digital and online banking facilitation, now with the regulator.

IV

Trade, skills & investment climate

ICT itemstariff relief
Tariff concessions on ICT items

Secured through P@SHA's tariff proposals to the Ministry of Commerce.

EDFproposal
EDF proposal completed with the Ministry of Commerce

P@SHA's Export Development Fund proposal, developed and delivered through direct engagement with the Ministry.

Rs. 10B+committed
Skills, education, and AI allocations in Budget 2026-27

Including Rs. 5.29B for digital skills targeting 120,000 youth and the AI Seekho 2026 programme, a meaningful increase in public investment in the sector's talent pipeline.

V

Member facilitation

Case-by-case resolution of regulatory matters for individual member companies, from EOBI to PTA to banking, is a standing part of the policy team's work. Recent EOBI resolutions, in members' own words:

"On behalf of PaysysLabs Private Limited, we would like to appreciate P@SHA for its timely and valuable support in facilitating our recent EOBI-related issue. Their guidance, coordination, and prompt response helped us move the matter forward efficiently."

PaysysLabs (Pvt) Ltd · EOBI matter resolved · Jun 2026

"We sincerely appreciate P@SHA's prompt response and proactive support in our EOBI matter. Their timely guidance and coordination reflect their strong commitment to serving member companies."

Rizwan Mahmood · Visionary Computer Solutions (Pvt) Ltd · EOBI matter resolved · Jan 2026