Freelancers to get 4pc incentive for software export

There is good news for about six lakh freelancers in the country as they now will get a 4 per cent incentive against export of software or IT-enabled services.

Freelancers who work at 55 marketplaces and have been selected by the ICT ministry will get the incentive, according to a Bangladesh Bank circular issued yesterday.

A freelance services marketplace is an online site where businesses or individuals find and hire individuals to do work remotely.

Popular marketplaces such as Upwork, Fiverr, Freelancer and Guru were among the selected marketplaces.

The freelancers in Bangladesh will get a boost with the incentives, something they have been seeking for a long time.

It is really encouraging that the government is now giving special attention to the freelancers and the move will definitely give a boost to them, said Rashad Kabir, managing director of Dream71 Bangladesh.

The government has been providing a 10 per cent cash assistance against the export of ICT products and services since 2018.

But only institutional IT and freelancing companies having membership with the BASIS are eligible.

With the BB circular, almost all of the freelancers irrespective of their membership with the BASIS will come under the 4 per cent incentive package.

The decision is likely to propel the flow of freelancers' earnings through official channels since some of the money comes through unofficial channels due to a lack of incentives.

"It's a common scenario in Bangladesh that many freelancers do not bring their whole remittance to Bangladesh," said Kabir, who is also a director of the BASIS.

"But with the introduction of an incentive facility they will be encouraged now to bring their whole income to the country, which will also add to the country's national GDP," he said.

The development comes at a time when the government has set a target to increase export earnings in the IT and IT-enabled services sector from the current about $1.1 billion to $5 billion by 2025. 

Bangladesh has six lakh IT service exporters or freelancers, and the number of team-based freelancing companies hovers around 1,600. Together they fetch roughly $500 million annually, according to industry people.

Many freelancers are also growing big now and forming companies as the companies are getting 10 per cent cash incentives on foreign export.

The government should continue providing facilities to them as their growth not only will bring more remittance to the country but also create scopes for the emergence of a lot of jobs, added Kabir.