Constitutional Maximum Limit

• The Constitution of India, under Article 276, sets the maximum annual limit of professional tax at ₹2,500 per person.
  
• This cap applies uniformly across all states, regardless of income or profession.
  
• No state is allowed to exceed this limit while levying professional tax.
  
• The cap ensures fair taxation and prevents overburdening taxpayers.
  
• This limit includes the total tax collected from a person in a single financial year.
  

Applies to All Categories of Taxpayers

• The ₹2,500 limit applies to salaried employees, self-employed professionals, business owners, and companies.
  
• Even high-income individuals and large businesses cannot be charged beyond this annual cap.
  
• Multiple registrations in the same state do not increase this limit per individual.
  
• However, persons operating in multiple states may be subject to tax in each state separately.
  
• Each state’s calculation must respect the ₹2,500 per-year ceiling.
  

Basis for Slab Calculation by States

• States design monthly, half-yearly, or annual slabs within this limit.
  
• For salaried individuals, the monthly deduction is usually ₹200, except ₹300 in February in some states, totaling ₹2,500 annually.
  
• Self-employed persons typically pay a flat annual amount up to ₹2,500.
  
• Employers deduct the tax over the course of the year from employees’ salaries.
  
• The slabs and deductions must ensure the total stays within the prescribed ceiling.
  

Uniformity Across India with Local Flexibility

• While the maximum amount is fixed, states have autonomy in designing their own tax slabs and payment frequencies.
  
• This allows flexibility to address local economic conditions while maintaining constitutional limits.
  
• States can also choose to exempt certain categories of individuals or reduce rates below ₹2,500.
  
• This structure provides both central oversight and regional adaptability.
  
• Employers and professionals must follow state-specific rules without exceeding the national cap.
  

Legal Compliance and Enforcement

• Taxpayers must ensure that their total annual payment does not exceed ₹2,500.
  
• State authorities are responsible for monitoring and enforcing this limit.
  
• If excess is deducted or paid, a refund or adjustment may be sought through proper procedures.
  
• Awareness of the cap helps prevent errors in calculation and deduction.
  
• Compliance with the ₹2,500 limit is essential for legal and financial correctness.