Professional Tax in Odisha

Odisha does not levy professional tax on salaried employees or professionals. Here's what applies to payroll compliance instead.

Updated: 06 October 2026

Why Odisha Has No Professional Tax

Odisha repealed professional tax outright. The Odisha State Tax on Professions, Trades, Callings and Employment (Repeal) Ordinance, 2026, notified on 21 April 2026, repeals the 2000 Act with retrospective effect from 1 April 2026, and the Finance Department directed drawing and disbursing officers to stop deducting PT from salaries from April 2026. Nothing is payable for any period on or after that date. The repeal is not a write-off of the past: the ordinance's savings clause keeps assessments, notices, payments and arrears for periods before 1 April 2026 valid and recoverable, so an employer with an open Odisha liability from FY 2025-26 or earlier still has to settle it. Until 31 March 2026 the rates were nil up to ₹1,60,000 of annual income, ₹125/month from ₹1,60,001 to ₹3,00,000, and ₹200/month above ₹3,00,000 with ₹300 in the final month.

What Applies Instead

Provident Fund (PF)

12% employer + 12% employee contribution to EPFO, unchanged by the PT repeal.

Employee State Insurance (ESI)

4% combined contribution for employees up to the ₹21,000/month wage ceiling.

TDS on Salaries

Deducted per the employee's applicable income tax slab.

Odisha Labour Welfare Fund

Still levied. LWF is a separate contribution and was not touched by the professional tax repeal.

Pre-April-2026 PT arrears

Assessments, notices and unpaid dues for periods before 1 April 2026 survive the repeal and remain recoverable by the authorities.

Odisha does levy the Labour Welfare Fund separately from Professional Tax. See Odisha LWF contribution rates.

Mannu Matta

Updated on: 06 October 2026

Frequently Asked Questions: Odisha Professional Tax

Is professional tax still applicable in Odisha?

No. Odisha abolished professional tax with effect from 1 April 2026 through a repeal ordinance notified on 21 April 2026. Employers should have stopped deducting it from the April 2026 payroll onwards.

What should an employer do if it kept deducting Odisha PT after April 2026?

Stop the deduction and refund what was taken, since no liability exists for those months. The state cannot collect tax for a period in which the levy does not exist, so amounts already remitted need to be taken up with the Commercial Tax and GST Organisation.

Does the repeal wipe out Odisha PT dues from earlier years?

No. The ordinance carries a savings clause. Assessments, notices, payments and arrears relating to periods before 1 April 2026 stay valid and recoverable, so an open FY 2025-26 liability still has to be settled.

What were the Odisha professional tax rates before the repeal?

Nil below ₹1,60,000 of annual income, ₹125 a month from ₹1,60,001 to ₹3,00,000, and ₹200 a month above ₹3,00,000 with a ₹300 deduction in the final month so the top band reached exactly ₹2,500.

Does Odisha still have a Labour Welfare Fund contribution?

Yes. LWF is a separate levy under its own Act and was unaffected by the professional tax repeal.

Professional Tax in Other States

Karnataka Maharashtra Telangana Tamil Nadu West Bengal Gujarat Delhi (NCT)Uttar Pradesh Haryana Andhra Pradesh Assam Bihar Jharkhand Kerala Madhya Pradesh Manipur Punjab Tripura

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