Professional Tax Slabs for States in India

In India, the term “Professional tax” is commonly known to many of us. If you are a salaried individual, you would have even noticed that in your payslips or Form 16 issued to you by your employer.

But, the question is how well you know about professional tax.

Not many of us are well aware of what professional tax is, why it is deducted from your salary income, and its compliance norms. So, understanding this will help you in your income tax filing. In this article, we will help you understand professional tax in general, its tax rates, and tax slabs in various Indian states.

Let’s start with asking a fundamental question.

What is Professional Tax?

At first look at the nomenclature, the term “Professional tax” can easily be misunderstood as a tax that is applicable and levied only on professionals.

But it’s not true.

The Professional tax applies to all professions, trades, and employment. For better clarity on the kind of professions – it is levied on employees working in a company, a person conducting a business, a lawyer, an accountant, a doctor, and it also includes freelancers, other professionals, etc.

The taxable amount is determined based on the income they generate and whether one has to pay or not is subject to a certain income threshold.

Now, you may think, isn’t this the same as the income tax? 
Then, how is income tax different from professional tax?

Let me explain it in detail.

How is Professional Tax Different From Income Tax?

As per Article 246(1) of the Indian Constitution, Parliament has the exclusive power to make laws concerning any of the matters enumerated in List I (Union List) in the Seventh Schedule, which includes taxes on income (Income Tax).

However, Article 276 of the Indian constitution has empowered all the Indian states to make laws relating to taxes on professions, trades, callings, and employment. States can levy their professional tax to benefit the state, municipality, district board, local board, or other local authority regarding the profession, trades, callings, or employment.

In simple terms, Income tax is levied by the Central Government, and the state government levies Professional Tax.

It is also important to note that a state can levy an upper limit of Rs.2,500 on an individual in a financial year. An individual cannot be charged beyond that. If you work in a company, then your employer must deduct it from your monthly salary. It is then remitted to the respective state government.

Now that you understand Professional tax in general. Let’s look into the Professional Tax slabs in various Indian states. 

Professional Tax Rates in Indian States:

As mentioned before, all Indian states have authority to determine their own professional rates which is applicable within their state administrative jurisdiction. So, professional tax slabs are different in different states.

Here is the list of Professional Tax Slabs for different states:

Professional Tax Slab in Karnataka:

Month Salary	Tax per month
Upto INR 15,000	-NIL-
Above INR 15,000	INR 200

Professional Income Tax in Tamil Nadu 

HALLF-YEARLY SALARY (in INR)	HALF-YEARLY PROFESSIONAL TAX
upto 21,000	-NIL-
21,001 – 30,000	INR 100
30,001 – 45,000	INR 235
45,001 – 60,000	INR 510
60,001 – 75,000	INR 760
75,001 and above	INR 1095

Professional Tax Slab in Kerala:

HALLF-YEARLY SALARY	HALF-YEARLY PROFESSIONAL TAX
Upto INR 11,999	-NIL-
INR 12,000 to INR 17, 999	INR 120
INR 18,000 to INR 29,999	INR 180
INR 30,000 to INR 44,999	INR 300
INR 45,000 to INR 59,999	INR 450
INR 60,000 to INR 74,999	INR 600
INR 75,000 to INR 99,999	INR 750
INR 1,00,000 to INR 1,24,999	INR 1000
Above 1,25,000	INR 1250

Professional Tax Slab in Andhra Pradesh:

MONTH SALARY	TAX PER MONTH
Upto INR 15,000	NIL-
INR 15,001 to INR 20,000	INR 150
Above INR 20,001	INR 200

Professional Tax Slab in Telegana:

MONTH SALARY	TAX PER MONTH
Upto INR 15,000	-NIL-
INR 15,001 to INR 20,000	INR 150
INR 20,001 onwards	INR 200
Upto 5 years (For professionals such as legal practitioners, CA, architects, etc.)**	-NIL-
More than 5 years (For professionals such as legal practitioners, CA, architects, etc.)**	INR 2,500 (per annum)

**: 
Legal practitioners, Solicitors, Notaries, Tax Consultants, Chartered Accountants, Technical and Professional Consultants, Engineers, RCC Consultants, Architects, Management Consultants, Estate Agents, Chief Agents, Principal Agents, Special Agents, Insurance Agents, Surveyors or Loss assessors registered or licensed under the Insurance Act, 1938 (Central Act IV of 1938), Pigmy Agents, UTI agents, Authorized assistants and Sub brokers recognized by SEBI, Commission Agents, Dalals, Brokers, Auctioneers, Medical Practitioners, Journalists, Medical Consultants (Other than Practitioners of Ayurvedic, Homeopathic and Unani systems of Medicines), Dentists, Radiologists, Pathologists and persons engaged in other similar professions or callings of a Paramedical nature.

Professional Tax Slab in Maharashtra:

MONTH SALARY	TAX PER MONTH
Upto INR 7,500	-Nil- (For Male)
Upto INR 10,000	-Nil- (For Female)
From INR 7,500 to INR 10,000	INR 175 (For Male)
INR 10,000 onwards	INR 200 fro 11 months + INR 300 for 12th month

Professional Tax Slab in Gujarat

MONTH SALARY	TAX PER MONTH
Upto INR 5999	-Nil-
INR 6000 to INR 8999	INR 80
INR 9000 to INR 11999	INR 150
INR 12000 and above	INR 200

Professional Tax Slab in West Bengal 

MONTH SALARY	TAX PER MONTH
Upto INR 10,000	-Nil-
INR 10,001 to INR 15,000	INR 110
INR 15,001 to INR 25,000	INR 130
INR 25,001 to INR 40,000	INR 150
INR 40,001 and above	INR 200

Professional Tax Slab in Tripura:

MONTH SALARY	TAX PER MONTH
Upto INR 7,500	-Nil-
INR 7,501 to INR 15,000	INR 1800
Above INR 15,001	INR 2,496

Professional Tax Slab in Odisha:

MONTH SALARY	TAX PER MONTH
Upto INR 1,60,000	-Nil-
INR 1,60,001 to INR 3,00,000	INR 1500
Above INR 3,00,001	INR 2500

Even though, states have all the rights to decide on their Professional Tax rates and slabs, not all states and union territories levy them.

Here is the list of States and Union territories where Professional Tax is not applicable:

STATES:

1. Arunachal Pradesh
2. Haryana
3. Himachal Pradesh
4. Jammu & Kashmir
5. Punjab
6. Rajasthan
7. Nagaland
8. Uttaranchal
9. Uttar Pradesh

UNION TERRITORIES:

• Andaman & Nicobar
• Chandigarh
• Delhi
• Puducherry
• Dadra & Nagar Haveli
• Lakshadweep
• Daman & Di

CONCLUSION:
Professional tax rates levied by the state government apply to all earnings through employment. It is a deductible amount for the Income Tax Act of 1961 and can be deducted from taxable income. Now that we have reached the end of the blog, we hope you gained clarity about professional tax and its rates in various Indian states.

If you have any queries regarding personal income tax or business taxation, you can contact our tax experts and clarify all your queries.