Profession Tax & Slab Rates in India By Vikram Shah - March 5, 2018 Last Updated at: Oct 15, 2020 5909 South Delhi Municipal Corporation has decided to strike South Delhi citizens with a triple sized skilled tax, an important increase in property tax on commercial property by including one of the variables in the formula and another 1 percent raise on property transfer. ET Wealth tells readers how they can optimize their tax by rejigging their income and investments. Tax optimisers IT profesionals can cut tax by Rs 26,000 via health insurance, perks. A profession tax is levied by individual state governments on persons who earn their living through employment, trade or professional work. The clause (2) of Article 276 of the Constitution of India gives permission to the states to levy this tax on persons practising/earning a salary in their territory. The amount of profession tax to be paid varies from one state to another and also depends on slab rates fixed by state governments. The maximum limit for Profession Tax is Rs. 2,500 per annum. Learn More about tax slab rates Since profession tax is levied by the state government, any amount paid as profession tax for that financial year is allowed for deductions on the income tax to be paid. The deductions are applicable as under Section 16 of the Income Tax Act. While a person earning an income will pay Profession Tax through their employers (deducted by the employers from the salary), the others need to pay it in person. Professional Tax Payment can be paid through registrations to local authorities, which is mostly state governments and in some cases, the local panchayats and other authorized bodies. Profession Tax in various states of India Andhra Pradesh In Andhra Pradesh, the profession tax is levied upon by the rules and regulations set through the Andhra Pradesh Tax on Profession, Trades, Callings and Employment Act, 1987. The profession tax slab rates in the State are as follows: Earnings Per Month Tax levied in rupees per month (Rs. Per Month) Up to 15,000 Nil Rs. 15, 001 to 20,000 150 Rs. 20,000 and above 200 Bihar In Bihar, the slab rates for profession tax on individual tax payers are as given in the table: Salary Earned Profession Tax to be paid Up to 25.000 Nil 25,001 to 41, 666 83.33 41,667 – 83,333 166.67 83,334 and above 208.33 Gujarat The profession tax laws in the State of Gujarat are governed by the Gujarat panchayats, municipalities, municipal corporations and state tax on the Professions, Traders, Callings and Employment Act, 1976. The slab rates, as fixed by the state, are as follows Salary Earned Profession Tax to be paid Up to 5,999 NIL 6000 – 8999 80 9000 – 11,999 150 12, 000 and above 200 Additional information about profession tax in Gujarat and the forms to be filled for registration of Profession Tax in the state. Karnataka Profession Tax slabs in Karnataka and the tax itself is levied with respect to the rules and regulations put forth through the Karnataka tax on Profession, Callings and Employment Act, 1976. The slab rates of the State are as follows: Salary Earned Profession Tax to be paid Up to 15,000 Nil 15,001 and above 200 per month Kerala The profession tax slabs in Kerala are as follows: Salary Earned Profession Tax to be paid Up to 1,999 Nil 2,000 – 2,999 20 3,000 – 4,999 30 5,000 – 7499 50 7,500 – 9,999 75 10,000 – 12, 499 100 12,500 – 16,666 125 16,667 – 20,833 166 20, 834 and above 208 Madhya Pradesh The Madhya Pradesh Vritti Kar Adhiniyam, 1995 has put forth rules and regulations to levy profession tax in the state. The state has also published a notice in the MP Gazette, Notification No. 174 dated 31/03/2012, through which the slab rates have been revised and valid with effect from 1/04/ 2012. The slab rates in the state are as follows Salary Earned Profession Tax to be paid per month Up to 12,500 Nil 12,500 to 14,999 125 15,000 and above 208 from April to Feb and 212 if paid in March Maharashtra Profession tax in Maharashtra is levied with reference to the Maharashtra State Tax on Professions, Trades, Callings and Employment Act, 1975 and came into effect from 1/04/1975. The slab rates in the state are as follows: Salary Earned Profession Tax to be paid Up to 7500 Nil 7501 and 10,000 175 10,001 and above 200 per month (300 for February) The Maharashtra government has a composition scheme for tax payers through which an advance of 10,000 as a lump sum payment can be paid for 5 years of tax. Tamil Nadu The Town Panchayats, Municipalities and Municipal corporations Rules, 1988, put forth by the Tamil Nadu government governs the collection of Profession Tax in the state. The slab rates for profession tax in Tamil Nadu are as follows: Salary Earned Profession Tax to be paid Less than 3,500 Nil 3501 – 5,000 16.66 5,001 – 9,000 40 9001 – 12,500 126.67 12,5001 and above 182.50 West Bengal The West Bengal State Tax on Professions, Trades, Callings and Employment Act, 1979, authorizes the collection of profession tax in India. The slab rates, with effect from 1/04/2013, is as follows: st Salary Earned Profession Tax to be paid Up to 8500 Nil 8501 – 10,000 90 10,001 – 15.000 110 15,001 – 25,000 130 25001 – Rs.40,000 150 40,001 and above 200 The West Bengal government levies a fine of 1% per month in case of late payments.