Surge in High-Income Taxpayers: Individuals Earning Over ₹1 Crore Increase by 323% Over the Decade

New Delhi: In a significant trend underscoring India’s expanding tax base, the number of taxpayers reporting an annual income of over ₹1 crore has surged by 323% over the last decade. This high-income taxpayer group grew from 82,836 in 2013-14 to 3,50,129 in 2023-24, according to government data. The broader pool of income-tax assesses has also witnessed a remarkable 120% increase, reaching 7.92 crore, reflecting successful efforts to promote tax compliance and reduce tax evasion.

The growth is not confined to the highest income bracket. Taxpayers with an annual income between ₹50 lakh and ₹1 crore increased by an impressive 440% over the same period, rising from 109,171 in 2013-14 to 589,762 in 2023-24. Officials attribute this expansion in the tax base to technology-driven compliance measures and non-invasive enforcement practices aimed at ensuring wider tax participation without placing undue pressure on middle-income earners.

Impact of Compliance and Technology-Driven Measures

Improved compliance mechanisms and simplified filing processes have encouraged more individuals, particularly in higher income brackets, to report their incomes accurately. Officials cited a nearly fivefold increase in tax filings from individuals earning above ₹50 lakh, a category that now contributes about 76% of total income tax collections. These increased collections have eased the tax burden on middle-class taxpayers.

The government has implemented strong anti-evasion policies, focusing on higher-income earners to address tax discrepancies while providing relief to those in lower income brackets. Consequently, the number of zero-income tax filers has surged, growing by 172% from 18 million in 2014 to 49 million in 2024. This rise is partly attributed to the increased exemption threshold, which has benefited low- and middle-income groups.

Middle-Class Relief and Reduction in Tax Burden

To protect the middle class, the government has systematically increased the income threshold for tax exemption. The exemption limit, which was ₹2 lakh before 2014, has risen to ₹7 lakh, reducing the effective tax burden on individuals with moderate incomes. According to officials, tax collected from those earning below ₹10 lakh annually has decreased from 10.17% of the total income tax in 2014 to 6.22% in 2024.

Moreover, the tax paid by middle-class earners in specific brackets has also seen a significant reduction. For instance, the average tax liability for individuals earning between ₹10 lakh and ₹15 lakh dropped from ₹2.3 lakh to ₹1.1 lakh. Similarly, for those earning between ₹15 lakh and ₹20 lakh, the average tax paid declined from ₹4.1 lakh to ₹1.7 lakh.

India’s tax landscape has undergone a transformative change over the past decade, characterized by a widened tax base, targeted relief for the middle class, and improved compliance. The growth in high-income taxpayer filings signals both increased affluence and effective enforcement strategies, positioning India’s tax system as both progressive and inclusive.