Odisha Professional Tax Abolished With Retrospective Legal Protection: Key Insights for Assessees

The State of Odisha has formally withdrawn its levy of professional tax through the Odisha State Tax on Professions, Trades, Callings and Employments (Repeal) Ordinance, 2026. This measure has been notified in the Odisha Gazette dated 21 April 2026, and takes effect from 1 April 2026. While the tax has been abolished prospectively, the law carefully safeguards all rights, liabilities, and proceedings arising under the earlier enactment.

This article explains the implications of this change for assessees, employers, businesses, and professionals who were earlier liable under the Odisha State Tax on Professions, Trades, Callings and Employments Act, 2000.

Background: Why an Ordinance Was Used

Constitutional basis under Article 213

The Governor of Odisha invoked the ordinance-making power under Article 213 of the Constitution of India. This provision allows the Governor to promulgate an ordinance when:

  • The State Legislature is not in session, and
  • Immediate legislative action is considered necessary in the public interest.

In this instance:

  • The Legislature of the State of Odisha was not in session, and
  • The Governor recorded satisfaction that it was necessary to immediately repeal the Odisha State Tax on Professions, Trades, Callings and Employments Act, 2000.

On this basis, Odisha Ordinance 02 of 2026, titled “The Odisha State Tax on Professions, Trades, Callings and Employments (Repeal) Ordinance, 2026”, was promulgated and subsequently published for public information through the Odisha Gazette (Extraordinary), No. 1496, Cuttack, Tuesday, April 21, 2026 / Baisakha 1, 1948.

Scope and Name of the Repeal Ordinance

Short title and commencement

The legislative instrument carries the following formal attributes:

  1. The short title of the law is “The Odisha State Tax on Professions, Trades, Callings and Employment (Repeal) Ordinance, 2026.”
  2. The Ordinance is deemed to have come into force with effect from 1 April 2026.

Important: Though the Gazette publication is dated 21 April 2026, the effective date for repeal is clearly specified as 01.04.2026. Assessees must therefore treat professional tax as abolished in Odisha from the beginning of the financial year 2026-27.

What Exactly Has Been Repealed?

Repeal of the 2000 Act

The Ordinance provides that the “Odisha State Tax on Professions, Trades, Callings and Employments Act, 2000” (Odisha Act 7 of 2000) is hereby repealed.

What this means in practical terms:

  • The State’s authority to levy, assess, and collect professional tax under the 2000 Act ceases from 1 April 2026.
  • No fresh liability to professional tax can arise under this Act for any period starting on or after 1 April 2026.
  • Registration, enrolment, and payment obligations under the 2000 Act do not continue for periods from FY 2026-27 onward.

However, this is not a blanket wipe-out of the old law for past periods. The Ordinance contains a savings clause, which is critical for understanding continuing rights and liabilities up to 31 March 2026.

Savings Clause: Protection for Past Actions and Liabilities

When a taxing statute is repealed, it is common for the repealing law to include a savings provision.