Only 76 lakh Indians make over ₹5 lakh a year... officially!
Finance Minister Arun Jaitley on Wednesday placed before Parliament some revealing data indicating that India's direct tax collection is not commensurate with the income and consumption pattern of the economy.
Among the 3.7 crore individuals who filed tax returns in 2015-16, 99 lakh showed income below the exemption limit of Rs 2.5 lakh per annum; 1.95 crore showed income between Rs 2.5 lakh and Rs 5 lakh; 52 lakh showed income between Rs 5 lakh and Rs 10 lakh, and only 24 lakh people declared income above Rs 10 lakh.
Of the 76 lakh individual assessees who declared income of above Rs 5 lakh, 56 lakh are in the salaried class.
The number of people showing income more than Rs 50 lakh in the country is only 1.72 lakh, Jaitley said while placing before "certain data" to indicate that "direct tax collection is not commensurate with the income and consumption". "We can contrast this with the fact that in the last five years, more than 1.25 crore cars have been sold, and number of Indian citizens who flew abroad, either for business or tourism, is 2 crore in the year 2015," he said. He said India's tax to GDP ratio is very low, and the proportion of direct tax to indirect tax is not optimal from the view point of social justice.