The number of Indian taxpayers, especially millionaires, has seen a remarkable rise over the past decade, reflecting the country’s rapid economic expansion and improved tax system. A new report from SBI Economic Research shows that while millionaire taxpayers numbered only 44,000 in 2013, this figure has soared to 2.2 lakh in the financial year 2024. This trend underlines how India’s economic progress is creating greater wealth and broadening the tax base.
Income Tax Collections Outpace Corporate Tax
The SBI Economic Research report highlights that personal income tax collections now surpass corporate tax collections, a trend that underscores a broader, wealthier taxpayer base. Direct tax revenues have also grown, accounting for 56.7% of total tax revenue in 2024, the highest level in 14 years. This marks a steady increase from the previous financial year, where direct tax contributions stood at 54.6% of the total.
As more individuals declare higher incomes, income tax has gained momentum, signaling significant improvements in compliance and awareness among taxpayers.
Expanding Middle Class and Increasing Tax Filings
The growth in the middle class is also contributing to increased income tax filings. In 2014, many individuals reported incomes between Rs 1.5 lakh and Rs 5 lakh. Fast-forward to 2024, and a considerable portion of this group has progressed into the Rs 2.5 lakh to Rs 10 lakh income bracket. This shift in income brackets points to rising incomes and spending power in India’s expanding middle class.
Another notable trend is the increase in women taxpayers, who now make up 15% of the total taxpayer base. Soumya Kanti Ghosh, Chief Economic Advisor of SBI Group, remarked on the steady rise in income tax return (ITR) filings, attributing it to government initiatives that have uplifted the lower-income groups by providing various schemes and financial programs.
Surge in Indian Billionaires and Growing Tax Compliance
The recently released Hurun India Rich List shows that India is now home to 334 billionaires, with 75 new billionaires added in just the past year. Indian cities have witnessed growing wealth, with 97 individuals from various regions joining the elite billionaire club. This rise in billionaires coincides with the growing number of ITR filings, which have reached around 7.3 crore filings this year. Projections suggest that this number could cross 9 crore by March 2025, as more people join the tax net and declare higher incomes.
The Path Ahead: Stronger Tax Base and Wealthier Population
India’s strengthened tax collection system, along with targeted policies, is facilitating an expanding base of taxpayers, many of whom are millionaires. This trend points toward a wealthier population and an increasingly inclusive economy. With rising ITR filings and a growing number of high-income individuals, India is moving towards greater economic self-reliance and tax compliance, ultimately fostering long-term growth and development.
