Salient Features of the Promotion Package for Industry 2022
Incentives Package for promotion of Industry
Investment in new industrial units and expansion and modernization of existing units
5% across the board payment of tax for all amounts invested
A minimum investment threshold of Rs 50 million is required.
An industrial unit to be set up as a company
Commercial production to begin by June 30th, 2024
Previous beneficiaries of amnesty schemes of 2018 and 2019 are not eligible.
Bank loan defaulters in the last three years are not eligible.
The promotion package for industry to revive sick units
It applies only to companies.
Industrial units having accumulated losses for a continuous 3 years are to be treated as sick units.
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The acquiring company was allowed to adjust the losses of the sick units against its income for three years.
Revival of the sick unit is to be completed within three years of acquisition.
The incentive for foreign investment in the industrial sector
Pakistani citizens who have been non-residents for five years and resident Pakistanis who have declared foreign assets are eligible to invest.
A one-time tax credit equal to 100% of the PKR equivalent of the remittance is to be availed in 5 years.
Investment to be made in a new industrial unit
Commercial production to start by June 30th, 2024.
PM unveils Package for promotion of Industry
On Tuesday, Prime Minister Imran Khan unveiled an incentive package for the promotion of the country’s industrial sector, with a focus on attracting investment from the local and expatriate business communities.
The package also aims to strengthen the country’s export-oriented industrial and manufacturing base.
According to the premier, overseas Pakistani entrepreneurs, as well as local businessmen, have been invited to invest in the industrial sector.
At a ceremony attended by businessmen and representatives of chambers of commerce and industry, the premier said, “In addition to expatriates, local businessmen in joint ventures will enjoy a five-year tax holiday with no questions.”
PM Imran maintained that the government’s goal was to promote export-oriented industries, which were deemed critical for the country’s socio-economic development and progress, as well as measures to strengthen small and medium enterprises (SMEs) and revitalize lagging industrial units.
He stated that Pakistan needed to entice the nine million overseas Pakistanis to invest in their homeland by offering incentives and giving them “confidence in the protection of their hard-earned capital.”
PM Imran also emphasized the importance of the industrial and manufacturing sectors in the creation of wealth, stating that countries cannot progress by producing only wheat and vegetables.
He stated that the socialist philosophy of nationalization in the 1970s changed the trajectory of growth and industrial development in Pakistan, which was heading in the right direction some 55 years ago.
The premier went on to say that previous governments’ anti-wealth creation and anti-profit-making policies were major impediments to the growth of Pakistan’s industrial sector, resulting in major economic problems such as a dollar shortage and current account deficits.
He claimed that the current government had decided to promote industries, particularly export-oriented industries.
PM Imran referred to a graph-chart in his February 28 address to the nation, stating that Pakistan ranked last in terms of export growth between 2000 and 2020, trailing Rwanda, Vietnam, India, China, and Bangladesh.
“Lack of long-term planning, a lack of dollars, and little or no growth in exports forced the country to approach the International Monetary Fund (IMF),” he explained.
Imran added that the current government’s two-pronged industrial policy has focused on the promotion of SMEs through improved regulations and ease of doing business, as well as the revival of sick industrial units.
