Senator Anusha Rahman has brought to light a growing concern regarding businesses falsely claiming IT status to exploit tax exemptions. During a recent Senate Standing Committee on Information Technology meeting, she pointed out that numerous companies, primarily involved in goods-related trade, are misrepresenting themselves as IT service providers.

The senator highlighted a disparity between the reported financial performance of legitimate IT firms, many of which have experienced losses in recent months, and those operating under this false pretense. She revealed that the Federal Board of Revenue (FBR) identified approximately 3,200 such entities. Notably, only a small fraction, eight, are registered with the Pakistan Software Houses Association (P@SHA).

Senator Rahman expressed alarm over the significant financial losses incurred in January and February, totaling $300 million, and warned of potentially severe economic repercussions if this practice continues unabated. She also stated that P@SHA was aware of this issue but refrained from reporting it to the Government due to fear of the revocation of tax exemptions.

Federal Minister Shaza Fatima Khawaja acknowledged the challenges posed by the FBR's automated system in addressing these concerns. She noted that improvements have been made to the customs system, following directives from the Prime Minister. However, Senator Rahman countered that the absence of a functional customs fee system in the initial months of the year raised further questions about the validity of these companies' IT claims.

Minister Khawaja clarified that P@SHA registration is not a universal requirement for IT companies and acknowledged that P@SHA itself is subjected to internal politics. She also contested the assumption that the presence of profitable companies negated the fact that other IT companies are experiencing losses. Despite those concerns, The Minister highlighted positive growth in internet usage and the IT sector overall.

The Prime Minister has now directed the FBR and the State Bank to safeguard legitimate IT companies from unnecessary scrutiny. The senate standing committee has asked for a complete list of all 3200 businesses, for the next scheduled meeting.