Every state has its own professional tax act. The Maharashtra State Tax on Professions, Trade, Callings and Employments Act, 1975 is applicable to the whole State of Maharashtra. The amount of tax paid under this Act shall not exceed Rs.2500 p.a. as per Article 276 of the constitution of India.

If any person to whom this Act is applicable can pay the lump sum amount of Tax for the period of five years. This tax is needed to raise resources to provide Employment Guarantee Fund to the establishment and to implement the Employment Guarantee Scheme of the State Government of Maharashtra. Even though an employee may be paying income tax, Professional Tax may be imposed on trades and professions.

[Suggested Read: District, State and National Legal Service Authorities In India]

For applying for Registration Form I needs to be filled. On satisfaction, the Authority will issue the Certificate of Registration. The term ‘person’ under the Act covers, a HUF, Company, Corporation, Firm, Society, Club or Association along with individuals.

  • The tax is levied in terms of slab rates which would depend on the income of the person concerned. 
  • The law has fixed Rs. 2500 as the maximum amount of tax that can be levied by any state. 
  • According to section 16 of the Income Tax Act, the amount paid as professional tax is deducted as per the income tax slab rates applicable. 
  • The tax is to be deposited by the employer in case of salaried people after deducting it from the salary. For others, the employee is liable to pay. 
  • The people liable to pay the tax has to register in a directed manner with the authority response which can be the State government, panchayat and local bodies

[Suggested Read: Shops and Commercial Establishments Act, 1961 – Brief Notes]