Pakistan lives predominantly by foreign trade, and its import tariffs and export tariffs are essentially revenue-producing. The national government does not levy income tax on agricultural income; only about 1% of the population pays income taxes. Rates are progressive, rising from 5% in the lowest category to 35% in the highest, with a net wealth tax of up to 2.5%. The basic corporate tax is 43%. This rate is higher for banks (58%) and lower for certain other public companies (33%). A value-added tax of 15% is levied on the value of goods. Shopkeepers went on strike in May of 2000 after hearing news that the sales tax would actually be enforced.
Established proportions of the various taxes levied by the federal government are distributed to the provincial governments. In addition, the provinces collect, for their exclusive use, taxes on land revenue, immovable property, vehicles, professions and services, and mineral rights, as well as excise taxes. Municipalities and other local governments also levy taxes.