Karachi is referred as the
financial capital of Pakistan. It accounts for a lion's share of Pakistan's
revenue generation. It generates approximately 53.38% of the total collections
of the Federal Board of Revenue, out of which 53.33% are customs duty and sales
tax on imports. Karachi produces about 30 percent of value added in large scale
manufacturing and 20% of the GDP of Pakistan. In February 2007, the World Bank
identified Karachi as the most business-friendly city in Pakistan. In 2010,
research by the global human resources company Mercer found Karachi to be the
most inexpensive city in the world.
According to the Pakistan Federal Board of Revenue's 2006-2007 year book tax and
customs units in Karachi was responsible for 46.75% of direct taxes, 33.65% of
federal excise tax, and 23.38% of domestic sales tax. Karachi also accounts for
75.14% of customs duty and 79% of sales tax on imports. Therefore, Karachi
collects a significant 53.38% of the total collections of the Federal Board of
Revenue, out of which 53.33% are customs duty and sales tax on imports. Revenue
collected from Karachi includes revenue from some other areas since the Large
Tax Unit (LTU) Karachi and Regional Tax Offices (RTOs) Karachi, Hyderabad,
Sukkur and Quetta cover the entire province of Sindh and Baluchistan. Karachi's
indigenous contribution to national revenue is 25%.