ITR filers with income above Rs 50 lakh increases 5x since 2014; middle class tax burden reduces

The tax burden on individuals earning below Rs 20 lakh annually has declined during Prime Minister Narendra Modi's governance in last 10 years, according to news agency PTI citing sources. However, those earning more than Rs 50 lakh had to pay more tax.

The data from income tax returns shows that individuals declaring annual income more than Rs 50 lakh has increased to 9.39 lakh in 2023-24, representing a five-fold increase from 1.85 lakh in 2013-14 and the tax liability for this income bracket has risen 3.2 times, from Rs 2.52 lakh crore in 2014 to Rs 9.62 lakh crore in 2024.

Sources indicate that 76 per cent of income tax revenue now comes from those earning above Rs 50 lakh annually, resulting in decreased tax pressure on the middle class.

The rise in high-income tax filers is attributed to robust anti-tax evasion and black money legislation implemented under the current government.

They further told that earlier iIn 2014, those having Rs 2 lakh annual income had to pay taxes but now due to various concessions and deductions introduced by the government, individuals earning up to Rs 7 lakh are exempt from taxes.

The proportion of tax collection from those earning below Rs 10 lakh has decreased from 10.17 per cent in 2014 to 6.22 per cent in 2024.

Sources reveal that taxpayers earning between Rs 2.5 and Rs 7 lakh faced an average tax liability of Rs 43,000 in 2023-24, approximately 4-5 per cent of their income, representing the lowest rate among emerging economies.

Official calculations indicate a nearly 60 per cent reduction in tax liability for the Rs 10-20 lakh income bracket, after accounting for inflation over the decade.

The total number of individual tax returns has shown substantial growth, increasing from 3.60 crore in 2013-14 to 7.97 crore in 2023-24, marking a 121 per cent rise.

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