Executive Summary

• Professional Tax Rates are final. West Bengal Finance Department has notified a new Schedule of professional tax rates that replaces the old Schedule, in two stages.
• Employees: From 1 October 2026. No tax on monthly salary up to Rs 20,000 (earlier Rs 10,000). Everyone earning Rs 10,001 to Rs 1 lakh a month pays less; those above Rs 1 lakh pay Rs 208 a month instead of Rs 200. The first deduction at the new rate is in the October 2026 payroll. Deposit and return dates do not change.
• Self-employed and businesses: From 1 April 2027. The many profession- and business-specific entries are replaced by two simple rate lists: one based on yearly income for individual professionals, and one based on yearly turnover for businesses supplying goods or services.
• Flat Rs 2,500 list expanded: From 1 April 2027. Twenty-five categories, including companies and directors, consultants, tech and digital professionals, hospitals and shops in malls, will pay a fixed Rs 2,500 a year regardless of income or turnover.
• Maximum tax unchanged. No person pays more than Rs 2,500 a year.
• Other amendments to the Act. The West Bengal Finance Act, 2026 also brings employees working in West Bengal within coverage even where the employer or payroll is outside the State, requires manpower details in employer returns, and replaces imprisonment with fines. None is in force yet. Each needs a notified date, and the Act permits retrospective effect. Rs 2,500 a year also becomes the default rate for anyone outside the Schedule, from a date to be notified.

Background and Commencement

The new Schedule is issued on 16 September 2026 under the West Bengal State Tax on Professions, Trades, Callings and Employments Act, 1979, following the West Bengal Finance Act, 2026, published on 7 August 2026 (Notification No. 756-L).

The changes under the new notification take effect in two stages. The employee rates and the list of exempt persons apply from 1 October 2026, in the middle of the current financial year. The rates for self-employed professionals and businesses, and the flat Rs 2,500 list, apply from the financial year beginning 1 April 2027. Those dates come from the note at the end of the Schedule.

Section 3(2A), under which the Schedule is issued, is itself among the Finance Act provisions still awaiting a commencement date. We read the Schedule’s dates as carrying it, but that is an inference. The notification is also silent on non-employees before 1 April 2027. We read the existing entries as continuing.

Salaried Employees

Effective from 1 October 2026, anyone earning up to Rs 1 lakh a month will pay the same or less. Only those earning above Rs 1 lakh pay more, and only by Rs 8 a month.

Employers deduct the tax from salary before paying it and must deposit it whether or not it was deducted. The new rates apply to salary for October 2026 onwards, and the earlier rates to April to September. If September salary is paid in October, we read the earlier rate as applying, but the notification does not say so.

Monthly Professional Tax Rates for Salaried Employees

Monthly Salary (Rs)	Earlier Deduction (Rs a Month)	New Deduction (Rs a Month)	Difference (Rs a Month)
Up to 10,000	Nil	Nil	No change
10,001–15,000	110	Nil	Saves 110
15,001–20,000	130	Nil	Saves 130
20,001–25,000	130	100	Saves 30
25,001–30,000	150	100	Saves 50
30,001–40,000	150	140	Saves 10
40,001–50,000	200	140	Saves 60
50,001–1,00,000	200	170	Saves 30
Above 1,00,000	200	208	Pays 8 more

What Counts as Salary?

The new rates apply to monthly salary, wages, remuneration, reward or compensation, which is wider than the earlier “salary or wages”. Employers should check which pay items their payroll includes when deciding the rate.

Self-Employed Professionals and Businesses

Effective from 1 April 2027, the tax will depend on what was earned or billed in West Bengal in the previous year. The tax for 2027–28 will therefore be based on figures for the current year, 2026–27.

Professional Tax Based on Annual Income and Turnover

Professionals: Yearly Income (Rs)	Tax a Year (Rs)	Businesses: Yearly Turnover (Rs)	Tax a Year (Rs)
Up to 2.5 lakh	Nil	Up to 10 lakh	Nil
2.5 lakh–5 lakh	1,000	10 lakh–20 lakh	1,000
5 lakh–10 lakh	2,000	20 lakh–40 lakh	1,500
Above 10 lakh	2,500	Above 40 lakh	2,500

These lists apply only to persons who are not on the flat-rate list or the exempt list below.

Flat Rs 2,500 a Year, Whatever the Income

Effective from 1 April 2027, twenty-five categories pay a fixed Rs 2,500 a year. They include:

• Companies and industrial establishments: Companies and their directors, banks and factories.
• Consultants: Management, financial, strategy, IT, marketing and HR consultants.
• Tech and digital professionals: Independently working cloud professionals, data scientists, cyber security professionals, software architects, UI/UX professionals and product managers.
• Education and marketing: Online educators, EdTech founders and digital marketing agencies.
• Healthcare: Hospitals, nursing homes, labs, diagnostic, day-care and IVF centres.
• Hospitality and retail: All shops in malls and multiplexes, air-conditioned restaurants and hotels, homestays and short-term rentals, and air-conditioned salons, spas and gyms.
• Other businesses: Estate agents and brokers, fuel stations, security agencies, content production houses and liquor businesses.

 

The Schedule has further entries. A company and each of its directors pay separately. Entry 10 (food businesses, hotels, short-term rentals) is unclear on how far the air-conditioning qualifier reaches.

Persons Who Remain Exempt

Still exempt from 1 October 2026: Persons with disabilities who do not pay income tax (with a medical certificate), members of the defence forces, and BSF personnel on active duty.

Amendments to the Act: Previous vs Current Position

The West Bengal Finance Act, 2026 amends the Act as set out below. Only Section 1 of the Finance Act is in force. The rest takes effect on dates the State Government notifies, which may differ by provision and may be retrospective. We have not traced any such notification.

Provision	Previous Position	Position Once in Force	What It Means
Section 2(b)(iii): Other employees	A person in any employment of an employer, not covered by items (i) and (ii).	A person in any employment of an employer in any part of West Bengal, whether or not the employer’s headquarters or the place of salary payment is in the State.	Employers paying West Bengal-based staff from another State must register and deduct West Bengal professional tax.
Section 3(2): Levy	Tax payable at the rate shown against the relevant class of persons in the Schedule.	Every person engaged in a profession, trade, calling or employment is liable at Rs 2,500 a year.	Once in force, Rs 2,500 is the default rate for anyone not covered by a Schedule entry. Unclear whether it applies before 1 April 2027.
Section 6(1): Employer returns	Returns show salaries and wages paid and tax deducted.	Returns must also show details of manpower hired or supplied by the employer.	Contractors, manpower suppliers and principal employers must capture this data.
Section 7(4a): Time limit for assessment	No assessment after two years.	No assessment after 30 September following two years from the end of the financial year.	About six months longer. Assessment for 2026–27 can be made until 30 September 2029.
Section 15(1a): Annual compliance certificate	CA, CS or Cost Accountant certificate due from registered employers who paid, or were liable to pay, tax of Rs 30,000 or more in a year.	Certificate due from a registered employer whose annual gross turnover or receipts in West Bengal (including all branches) exceeded Rs 10 crore in the preceding year.	Test moves from tax paid to turnover. Some employers fall out; others come in.
Section 19(1): Offences	Simple imprisonment up to six months, or fine up to Rs 1,000, or both; up to Rs 50 a day if continuing.	Fine up to Rs 2,000; up to Rs 100 a day if continuing. No imprisonment.	Imprisonment removed. Higher fines.
Sections 19(2) and 19(3): False records and obstruction	Imprisonment of three months to one year, or fine up to Rs 5,000, or both.	Fine up to Rs 10,000. No imprisonment.	Imprisonment removed. Higher fines.
Section 19(4): Nature of offences	Offences cognizable and bailable.	Provision omitted.	No longer declared cognizable; the general classification applies.
Schedule of rates	Schedule under Section 3(2), with category-specific entries.	New Schedule under Section 3(2A), notified on 16 September 2026.	Employee rates from 1 October 2026; other rates from 1 April 2027.

Other Rules to Keep in Mind

Falling Under Two Categories

If a person falls under two categories, the higher rate applies, as before.

Branches

Each branch or office in West Bengal pays the same rate as the main business. This rule continues from the earlier Schedule.

Below the Limit but Want to Stay Enrolled?

The tax is Rs 2,500 for those on the flat-rate list, or Rs 1,000 for others.

What Employers Should Do Now

• Update payroll now. Update the new rates before processing salaries for October 2026 and inform employees of the change in deduction.
• Returns and payments. Pay and file professional tax returns at the new rates from October 2026, and correct any excess or short deduction caused by the mid-year change.
• Check enrolment for 2027–28. Using the flat-rate list and the income and turnover limits, check whether the business must enrol, and apply within 90 days of becoming liable.
• Staff paid from outside West Bengal. Identify employees working in West Bengal whose salary is processed outside the State, and plan registration and deduction once the amended definition of employee takes effect (date awaited).
• Manpower records. If you hire or supply manpower, start maintaining the details that returns will need to show.
• Review existing enrolments. Where a business now falls below the limits, decide whether to stay enrolled at the minimum rate or apply for cancellation.

Disclaimer

This Flash Update is intended to provide a general summary of the new Schedule of rates under the West Bengal State Tax on Professions, Trades, Callings and Employments Act, 1979 for the information of our clients and should not be treated as legal advice or as a substitute for advice on specific facts.

Positions described reflect the state of the law as at the date of this update, and departmental clarifications issued hereafter may alter them.