Professional tax is a direct tax levied by the State Government on all kinds of professions, trades and employment in proportion to the income of the individual. Article 276, Clause 2 of the Indian Constitution covers the provision concerning professional tax in the country. Professional tax is imposed by state governments on the individuals who are employed in governmental, private and non-governmental organizations. The quantum of levy varies according to the strata of income. Profession tax is governed by the Town Panchayats, Municipalities and Municipal Corporation Rules, 1988. The slab rates are as follows: All employees and professionals with a monthly salary of over Rs. 3500 must pay profession tax, starting at just Rs. 16 per month and going up to Rs. 182 per month for those earning over Rs. 12,501.

As per the Tamil Nadu Municipal Laws Second Amendment Act 59 of 1998, section 138 C, “Any individual occupied in any trade, profession, employment and calling in the city limits of the Corporation of Greater Chennai, will have to pay the half-yearly Professional Tax. Half yearly income above Rs. 21000 attracts Professional tax.

Categories of individuals that can claim exemption from paying professional tax:

Professional tax is levied under the Town Panchayats, Municipalities and Municipal corporations rules 1988. Given below is the professional tax slab rate for salaried, income earning individuals in Tamil Nadu.