The tax on income levied by the state government on individuals is called Professional tax. Whether you are a professional, employee or trader, all are required to pay professional tax as per the specified threshold by the state government. In India, not all states levy professional tax and the tax slab or limits also varies with each state.

Although as per Article 246 of the Indian Constitution, the taxes on income can be levied or make laws in its respect comes only within the power of Parliament. However, professional tax is one such tax on income which is collected by the state government. The State Government can also make laws regarding professional tax. The maximum limit for professional tax has been set at ₹ 2,500 per year for an individual. While calculating income tax, the professional tax shall be deducted from the total taxable income.

Applicability and tax amount in professional tax.

1.    Persons in employment

2.    Dealer registered under the Madhya Pradesh Vat Act, 2002 and/or person registered under the Madhya Pradesh Goods and Services Tax Act, 2017.

3.    A dealer or person engaged in the sale or supply of goods or service but not registered either under the Madhya Pradesh Vat Act, 2002 or the Madhya Pradesh Goods and Services Tax Act, 2017.

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