Draft of National Freelancing Policy Offers Incentives to Registered Freelancers

The Ministry of Information Technology and Telecommunication has proposed a “National Freelancing Policy” aimed at establishing Pakistan as a prominent global freelance market and boosting the country’s exports and foreign exchange earnings. 

Under the policy, freelancers registered with the Pakistan Software Export Board (PSEB) would benefit from a reduced sales tax rate of up to 2 percent on their local services revenue. The PSEB, in collaboration with the State Bank of Pakistan (SBP), would streamline inward foreign exchange remittances from freelancing activities using specific codes designated by the SBP. These remittances would be exempted from income tax.

To facilitate foreign exchange transactions, the PSEB would work with the SBP to enable registered freelancers to open foreign exchange bank accounts. Freelancers would be allowed to retain 35 percent of their foreign exchange income received as inward remittances in these accounts. Additionally, the policy aims to ensure that foreign exchange export remittances received under freelancing codes remain income tax exempted until 2030, with the cooperation of the Ministry of Finance and the Federal Board of Revenue.

Visa facilitation would be provided to freelancers who have a minimum record of two years of IT and ITeS export remittances exceeding US $5,000 per annum through formal banking channels. Furthermore, registered freelancers with a minimum record of five years of freelancing exports remittances exceeding $12,000 per annum would be eligible for subsidized home loan schemes under government and private initiatives.

The policy emphasizes providing freelancers with access to international markets, projects, and clients. The policy also envisions subsidized, collateral-free loans up to Rs. 1.0 million being made available to registered freelancers through existing and new initiatives of banks and financial institutions.