Marginal rise in professional tax collection in 2015-16 in Maharashtra

Professional tax is levied by various state governments on salaried individuals, working in government or non-government entities.

By: PTI | Mumbai | Published:November 23, 2016 1:24 pm
tax-759 The maximum professional tax that can be levied by any state till date is Rs 2,500 per annum. (File)

Collection of professional tax in Maharashtra has registered a marginal rise of just Rs three crore in last financial year. According to gross receipts from 2005-06 to 2015-16, furnished by the Assistant Commissioner of Sales Tax (administration) of Maharashtra, Rs 1,688 crore professional tax was collected in 2010-11 fiscal year, Rs 1,830 crore in 2011-12, Rs 1,944 crore in 2012-13 and Rs 2,146 crore in 2013-14, as per RTI activist Manoranjan Roy who had sought details in this regard.

However, in subsequent years, the annual growth in this tax collection saw a marginal rise. The professional tax collected in 2014-15 went up by Rs 20 crore to Rs 2,166 crore. In 2015-16, it went up by just Rs 3 crore to Rs 2,169 crore.

Professional tax is levied by various state governments on salaried individuals, working in government or non-government entities, or in practice of any profession, including chartered accountants, doctors, lawyers, etc or those who carry out some form of business.

An employee earning between Rs 7,500 and Rs 10,000 per month needs to pay Rs 175 per month as professional tax, while those earning over Rs 10,000 or above per month need to pay Rs 200 for eleven months and Rs 300 for the last fiscal month. Women who earn up to Rs 10,000 per month have been exempted from paying professional tax, effective from April 2015.

The maximum professional tax that can be levied by any state till date is Rs 2,500 per annum. The total amount of professional tax paid during the year is allowed as deduction under the Income Tax Act.

Asked about the reasons for only a marginal rise in professional tax collection, state Finance Minister Sudhir Mungantiwar attributed it to the exemption from such tax given to the working women.

He said, “We have decided not to levy professional tax on women who earn less than Rs 10,000 per month and that is why growth in collection of professional tax has reduced.”

The professional tax is a source of revenue for state governments which helps in implementation of various schemes for the welfare and development of the region.