The Pakistan Freelancers Association (PAFLA) has urged the Federal Board of Revenue (FBR) and the Ministry of Finance to maintain supportive fiscal policies for freelancers and the digital workforce in the Federal Budget 2026–27.
The association recommended retaining the 0.25% percent tax rate on foreign exchange earnings for at least the next ten years, along with measures to strengthen the sector through capacity-building initiatives, the establishment of freelancing hubs in multiple cities, and subsidies for internationally recognized certifications.
PAFLA Chairman Ibrahim Amin said extending the low-tax regime would encourage freelancers to bring their earnings through formal banking channels and help expand participation in freelancing among students, young professionals, and women.
He noted that freelancers registered with the Pakistan Software Export Board (PSEB) currently benefit from the reduced tax rate, and said PAFLA is working with PSEB to simplify registration so more individuals can access these incentives. He added that a stable and simplified tax framework would benefit freelancers, software houses, and the broader IT industry.
Citing International Labour Organization (ILO) recognition of Pakistan as a major global provider of digital labour, he said the country’s freelance ecosystem reflects strong growth in the technology sector.
According to the State Bank of Pakistan, freelancing export earnings reached $959 million during July–April FY2025–26, showing a 49 percent increase compared to the same period last year.
PAFLA President and CEO Dr. Imran Batada said the government should also avoid imposing additional taxes on content creators producing knowledge-based digital content, including educational material, training content, news analysis, and infotainment.
He warned that complex taxation frameworks could push digital workers toward informal channels, potentially reducing documented remittances and weakening foreign exchange inflows.
Dr. Batada also called for improvements in payment infrastructure, including the development of a globally integrated national payment gateway to facilitate digital transactions for freelancers and IT exporters.
Dr. Batada said freelancers have contributed nearly $1 billion in foreign exchange earnings this fiscal year, adding that Pakistan’s young digital workforce represents a major opportunity for economic growth and export expansion.
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