Many remunerated employees might be well aware of the term ‘Professional Tax’. It is a direct tax, levied and collected by State Governments in India. Professional Tax is a Tax levied on all kinds of professions, trades, callings and employment based on the income of such profession, trade, callings and employment. It is levied on both self-employed and remunerated employees under an employer (i.e. inclusive of person carrying business, freelancers, professionals etc.,) subject to income exceeds the monetary threshold if any.
The process towards payment of Professional Tax in Gujarat has been complicated and time-taking. The state levies Professional Tax on individuals engaged in any profession, trade, calling or employment, here both the self-employed individual and employees working under an employer are required to pay this tax. The self-employed individuals can pay their PT annually but employers are required to pay the PT on monthly basis to the treasury on behalf of their employees vide depositing the amount in the local branch office of a bank and to collect receipt of such payment after 2 to 3 days of time. In addition to this, companies operating with more than one unit in and around cities of Gujarat have no centralized office/branch to remit Professional Tax. We, Aparajitha Corporate Services Private Limited, are offering services to remit professional tax for our client in and around Gujarat, and upon servicing our clients, realized these real time difficulties with regards to depositing Professional Tax in the state of Gujarat. Also we recently became aware of a new E-Portal i.e. E-Nagar Portal that has been introduced only for the city of Ahmedabad which enables online remittance of Professional Tax, however other cities in Gujarat still follow the offline mode.
Considering all these discrepancies we made the following recommendations to the CMO Gujarat and the Labour, Skill Development & Employment Department:
- Reduced Payment Frequency as Annually or Half-Yearly.
- Introduce online payment mode for all locations in Gujarat.
- Implement a centralized payment location for industrial establishment operating in more than one place.
And requested to implement those measures as to enhance and reduce the regulatory burden to remit the Professional Tax in Gujarat.
Now the Government of Gujarat is in process of taking the above recommendations into consideration, which would ultimately result in a business-friendly environment in Gujarat and ultimately ease the business processes. It will also ensure that with respect to the Professional Tax, companies in Gujarat are more compliant.
