Special Technology Zones Authority to be developed by the Pakistnai government to grant tax-exemption to developers.
ISLAMABAD:
The government has agreed to create the Special Technology Zones Authority (STZA) by promulgating a decree aimed at granting developers and businesses a 10-year tax exemption.
The government will also offer tax exemptions to businesses in the district. They shall also be exempted from all customs duties and taxes on capital products for a term of 10 years from the date on which the authority grants the license.
Sources said the government had agreed to give the developers of the technology zone incentives. Developers will be exempted from all customs duties and taxes for a period of 10 years from the date of signature of the Capital Goods Production Agreement, including but not limited to, products, plants, machinery, hardware, equipment and software imported into Pakistan for consumption within zones by developers of the Authority and Zones.
The aim behind the development of these zones was to provide globally competitive and export-oriented structures and ecosystems with institutional and legislative support for the technology sector in addition to developing cooperation between academia, researchers and the technology industry.
At its meeting held on 24 November, the Cabinet was told that a meeting had been held at the Office of the Prime Minister on 5 November 2020 on the formation of the STZA.
This will help to build jobs in the technology sector and to draw on dividends for young people. In addition to enhancing the quality of domestic technology goods and services and promoting innovation, the development of the Authority will provide an atmosphere that would attract foreign direct investment.
The Prime Minister ordered the creation of an authority under the Cabinet Division, which was further directed to finalize the draft legislation (ordinance) and to bring a case for its implementation within two weeks. The proposed draft legislation was discussed with the Law and Justice Vetting Division and with suggestions and opinions from the Finance Division, the Federal Revenue Board and the State Bank of Pakistan, which were integrated into the draft legislation.
Therefore the Cabinet Division demanded the cabinet’s approval of the draft legislation for the formation of the STZA. The prime minister emphasized the need for the economic uplift authority to be created and the cabinet completely supported the reasoning behind the proposed authority being created. The Finance Division reflected on the provisions of Section 21(b) and Section 22(b) of the proposed ordinance and proposed changes to those articles.
