WHICH STATES AND UNION TERRITORIES IN INDIA HAVE IMPOSED PROFESSIONAL TAX?

There are some states and union territories in India that have not imposed Professional Tax yet, though the majority of the Indian states and union territories do charge Professional Tax. Let us have a look at which state or union territory falls in which of these two categories, in detail. This subject can be discussed as below –

States and union territories that have imposed Professional Tax:-

• Andhra Pradesh
• Assam
• Bihar
• Chattisgarh
• Gujarat
• Jharkhand
• Karnataka
• Kerela
• Madhya Pradesh
• Maharashtra
• Manipur
• Mizoram
• Meghalaya
• Nagaland
• Odisha
• Puducherry
• Punjab
• Sikkim
• Tamil Nadu
• Telangana
• Tripura
• West Bengal

Note: - As per the Nagaland Department of taxes, Professional Tax is imposed in the state. But according to some other publications, Professional Tax is not imposed on the citizens of Nagaland presently.

States and Union Territories that have not imposed Professional Tax:-

• Andaman & Nicobar Islands
• Arunachal Pradesh
• Dadra and Nagar Haveli
• Daman & Diu
• Delhi
• Goa
• Haryana
• Himachal Pradesh
• Jammu & Kashmir
• Lakshadweep
• Rajasthan
• Uttar Pradesh
• Uttarakhand

Professional Tax, as we have already discussed, is not uniform in all the states and it has different slab rates in different states. This means that in every state imposing this tax, there are different tax slabs. Now, the amount of tax, i.e. the slab into which a particular person falls residing in a particular state is based on the gross income of an individual, whether a professional like doctor, lawyer, Chartered Accountant (CAs), Company Secretary (CS) or a salaried employee. This implies that Professional Tax depends on the annual income or earning of an individual. It is deducted from the salary of the employer on a monthly basis. In the case of a company, everyone associated with the company – the Directors, the Partners, the self-employed professionals, or the owners of the business – Professional Tax is to be submitted based on their gross turnover for the previous financial year.

However, for some cases, the amount of tax is fixed in nature and that amount must be paid irrespective of the money that one earns in a financial year. Hence, in such cases, the turnover arising in a company is not considered. The amount is fixed and that only has to be paid as Professional Tax. For instance, in the state of West Bengal, compulsory payment of Rs. 2500 must be made as Professional Tax, irrespective of the turnover, and in the case of a factory, the owner needs to pay Professional Tax only if the turnover for the preceding financial year exceeds Rs. 5 Lakhs. Professional Tax is deducted from the salaries of the employees by the owner of a particular business and then the amount collected for this purpose is paid to the concerned department of the State Government. After the submission of Professional Tax, one also needs to file a return based on what is submitted within a specific time.

However, just like all other types of taxes, the laws pertaining to Professional Tax change from time to time. Hence, the current rules and regulations must be checked before proceeding for anything related to Professional Tax.