Multiple States Revise Professional Tax Slabs for FY 2025-26
West Bengal, Gujarat and Karnataka have each notified revised professional tax slabs effective this financial year, requiring payroll masters to be updated state-by-state.
Effective from 1 April 2025
Professional Tax continues to be levied under state-specific legislation, and payroll teams operating across multiple states have had to contend with a cluster of slab revisions taking effect for FY 2025-26, notified with varying timelines by West Bengal, Gujarat, and Karnataka.
West Bengal has revised its monthly salary slabs such that employees earning up to ₹10,000 remain exempt, those earning between ₹10,001 and ₹15,000 attract ₹110 per month, ₹15,001 to ₹25,000 attract ₹130 per month, ₹25,001 to ₹40,000 attract ₹150 per month, and above ₹40,000 attract the maximum ₹200 per month (with ₹300 recovered in February as per the statutory annual cap of ₹2,500).
Gujarat has similarly revised its slabs, removing the erstwhile lower exemption threshold for salaries up to ₹12,000 and introducing a flat ₹200 per month levy for salaries above ₹12,000, aligning more closely with the national ceiling of ₹2,500 per annum under Article 276 of the Constitution.
Karnataka's revision retains its structure of nil tax up to ₹24,999 per month and ₹200 per month thereafter, but has clarified applicability to employees on fixed-term and contract engagements drawing salary directly from the principal employer, closing a previously ambiguous area for gig and contract-heavy organisations.
Employers with establishments across these states must register separately for Professional Tax Registration Certificate (PTRC) and, where applicable, Enrolment Certificate (PTEC) obligations for the employer entity itself, and file monthly or annual returns as prescribed by each state — return periodicity is not uniform and is a frequent source of penalty notices for multi-state employers.
Since Professional Tax is deducted at source from employee salary and remitted by the employer, incorrect slab mapping in payroll software directly exposes the employer to both under-deduction recovery notices and employee-relations issues arising from retrospective correction of net pay.
Payroll teams should update state-wise PT slab tables in the payroll system before the next processing cycle, cross-check with the applicable annual ₹2,500 cap under the relevant state Act, and issue a communication to employees in the affected states explaining any change in net take-home pay.
Key takeaways
- West Bengal, Gujarat and Karnataka have each revised PT slabs for FY 2025-26.
- The constitutional annual PT cap of ₹2,500 remains the benchmark across states.
- Gujarat removed its erstwhile lower exemption threshold below ₹12,000.
- Karnataka clarified PT applicability to fixed-term/contract employees.
- Multi-state employers must track differing return filing periodicities to avoid penalties.
Action required
Update state-wise professional tax slab tables in payroll systems immediately and notify affected employees ahead of the next pay cycle.
