Karnataka pushes for higher professional tax cap to ₹6,000 amid inflation concerns

Karnataka Revenue Minister Krishna Byre Gowda has called for a Constitutional amendment to raise the professional tax cap, citing its stagnation over decades. Speaking at the GST Council’s pre-budget meeting in Jaisalmer, Rajasthan, Gowda submitted a memorandum to Union Finance Minister Nirmala Sitharaman, proposing an increase in the tax’s upper limit from ₹2,500 to ₹6,000 per annum.

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The minister emphasized that the tax, unchanged for decades, has lost its value significantly due to inflation and economic growth. “The professional tax today is worth less than a tenth of its original value. This small adjustment is long overdue,” Gowda reportedly said.

Representing Karnataka on the GST Council, Gowda noted that similar concerns were raised by ministers from three to four other states during the meeting. “States have been revising other taxes annually, but the professional tax remains untouched. It defies logic to keep it stagnant,” he added.

Highlighting the need for the amendment, Gowda argued that it would allow states to better manage their revenue needs amid growing financial demands. Karnataka, along with other states, has repeatedly urged the central government for this change.

The proposed increase reflects decades of economic growth and aims to restore the tax’s relevance. Gowda reassured that the demand is modest, seeking only a reasonable revision rather than drastic changes.