Govt. register freelancers for fear of money laundering

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The Ministry of Information and Telecommunications told the Senate that the administration wanted to register freelancers as a measure to stop money laundering.

A meeting was held recently between the Senate Information and Telecommunications Committee and the Ministry of Information Technology and Telecommunications. The meeting was chaired by Senator Kauda Babar. The committee of senators was briefed by ministry officials on what action the government intends to take and why.

They explained to the committee that money laundering is a common concern for both the State Bank of Pakistan (SBP) and the Federal Board of Revenue (FBR). They said authorities are concerned about freelancers as they can be a big source of money laundering if they are not registered. However, no incidents from the past were cited or highlighted. They just fear that it might happen in the future.

Members of the committee of senators did not seem very happy with the measure. Although the fear that freelancers will be used as a source of money laundering seems justified, this measure will disadvantage them in many ways. The senators said that the government is supposed to facilitate freelancers, but it does the opposite. They have raised concerns that this will cause problems for freelancers.

However, not all senators seemed to be on one page. Some of them accepted the benefits of this measure. Senator Afnan Ullah Khan explained that similar objections have been raised by the Financial Action Task Force (FATF) regarding payments made to freelancers through international sources. He said it can also lead to terrorist financing if freelancers are not registered. He suggested that all payments be formalized and documented and relevant departments made aware so that there is no chance of illegal money transfers.

The members of the Ministry of Information Technology and Telecommunications also informed that the relative policy has been formed. One of the members, Syed Junaid Imam, said that the Ministry of Commerce has formulated the freelancer registration policy and possible methods of payment transfers.

As discussed at the meeting, the policy will be submitted to the Ministry of Finance in the coming week by the Ministry of Commerce. After the department’s review, it will be presented to the federal cabinet. In addition, another committee has been formed within the Finance Division which will deal with the process of international payments and registration. It is also supposed to facilitate gateways like PayPal which cannot be used in Pakistan so far.

The government brings such measures to stop money laundering, but freelancers are not happy about it. Most freelancers in the country are students, some do it part-time, and some have it as their sole source of income. On average, they do not earn large sums so if they are subject to taxes, it will further reduce their income. They complain that the government is not letting them survive and that many deductions are already taking place before they receive their final amount. It looks like an extra burden for them. What is your point of view on this?

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