Over 9 lakh Indians are earning more than Rs.50 lac per year: ITR Data

In recent years, more people in India have reported earning high incomes, and this has had a noticeable impact on the country’s tax base. Here’s a breakdown of what this means:

1. Increase in High-Income Filers: The number of people declaring an income of over ₹50 lakh annually has grown to over 9.39 lakh in 2023-24, up from just 1.85 lakh in 2013-14. This fivefold increase reflects an economy where more people are earning high incomes, partly due to economic growth and better job opportunities.
2. Higher Tax Collection from Wealthier Individuals: Alongside the rise in high-income earners, tax collection from these individuals has tripled, going from ₹2.52 lakh crore in 2014 to ₹9.62 lakh crore in 2024. This is partly because these individuals pay a higher percentage of their income as tax, contributing significantly to the government’s revenue.
3. Broader Tax Base: The overall number of people filing income tax returns (ITRs) has also more than doubled, from about 3.60 crore in 2013-14 to nearly 8 crore in 2023-24. This growth shows that more people are participating in the tax system, which strengthens the government’s financial position and supports funding for public services.
4. Reduced Tax Burden on Lower-Income Groups: The tax burden for people earning less than ₹20 lakh a year has decreased. In fact, individuals earning under ₹10 lakh now contribute only 6.22% of total tax revenue, down from 10.17% in 2014. The government has also raised the tax-free income limit, meaning those earning up to ₹7 lakh do not pay any tax now, freeing up income for spending, which helps stimulate the economy.
5. Anti-Tax Evasion and Economic Growth: Officials credit these positive changes to both better enforcement against tax evasion and technological improvements in tax administration. Additionally, as the economy grows and incomes rise, more people are entering higher tax brackets, reflecting an improvement in overall living standards and job quality.

Together, these factors indicate that India’s economy is strengthening, with more people earning higher incomes and contributing to a sustainable tax base.