Employment in Karachi

Local Economy

As the largest city in Pakistan and its financial center, Karachi has a thriving local economy. Karachi’s GDP (PPP) of 78 billion USD accounts for around 20% of the total GDP for Pakistan, and with a predicted growth rate of 5.55%, it will be worth an estimated 193 billion USD in 2025.

Karachi’s local economy relies heavily on industry, with steel, heavy machinery, and chemicals as the main products. Food processing and textiles are also key elements of the city’s industrial sector. In recent years, however, Karachi’s service sector has become increasingly important to the economy, with banking and finance leading the way.

Telecommunications, software production, and computer hardware assembly have all increased over the last decade, and now many foreign companies have call centers in the city — a government initiative to lower taxes on foreign company call centers has played a major part in this. Expatriates working Karachi tend to be employed in telecommunications, software production, banking, or finance.

Work Permits for Karachi

In Pakistan work permits and residence permits are rolled into one visa: the work visa. This will give foreigners and expatriates the right to live and work in Karachi legally for a stipulated time period, which is usually one year or the length of an employment contract. The work visa must be applied for before arriving in Pakistan, and it is usually your prospective employer that will make the application for you. Therefore it is suggested that expatriates find work in Karachi before considering a work visa application. In order for the work permit to be granted you will need to provide a number of legal documents, as well as undergo a full medical examination by a certified practitioner.

Income Taxation in Karachi

Any expatriates or foreigners working Karachi will be required to pay income tax. As Pakistan has a sliding scale tax system, your total earnings for the fiscal year determine the amount you will pay. The rates for 2014 were:

• In between 400,000 and 750,000 PKR — 5% of the income exceeding 400,000 PKR
• In between 750,000 and 1,400,000 PKR — 17,500 PKR + 10% of the amount exceeding 750,000 PKR
• In between 1,400,000 and 1,500,000 PKR — 82,500 PKR + 12.5% of the amount exceeding 1,400,000 PKR
• In between 1,500,000 and 1,800,000 PKR — 95,000 PKR  + 15% of the amount exceeding 1,500,000 PKR