How many people pay direct tax in India? (2024)

How many people pay direct tax in India?

The data shows that 7.4 crore people filed income tax returns in 2022-23, of which 5.16 crore people, or 70 per cent, had zero tax liability. This means that just 2.24 crore people paid income tax in 2022-23, which works out to just about 1.6 per cent of the total population in India.

How many individuals pay direct tax in India?

According to the data just released, the number of people paying direct taxes has risen from 7,42,49,558 in FY2016-17 to 9,37,76,869 in FY2021-22. This is impressive, but the catch is that most of the people entering the tax net declare nil income or a low income, as pointed out above.

What percentage of people pay tax in India?

India may hold the distinction of being the world's most populated country but only a small fraction of its population pay taxes. Data shows that currently India has 66.5 million individuals who pay personal income tax, which is 4.8% of total population and 6.3% of the adult population.

What is the percentage of direct tax in India?

In 2022-23, direct taxes made up 54.62 percent of the government's total tax revenue, up from 52.27 percent in 2021-22 and 46.84 percent in 2020-21 – the lowest in 15 years.

How many people pay indirect taxes in India?

Therefore, adjusting the base for double and triple counting, the GST has increased the number of unique indirect taxpayers by more than 50 percent –a substantial 3.4 million.

Who pays direct tax in India?

Direct taxes are levied on individuals and companies by the country's supreme tax body. Direct taxes are directly paid by those on whom it is imposed. For instance, taxpayers directly pay income tax, property tax, tax on assets and gifts to the government.

What is the percentage of direct and indirect tax in India?

Share of direct and indirect tax in total central tax in India FY 2018-2023. As per Indian Union Budget estimates for financial year 2023, direct taxes accounted for 51.5 percent and indirect taxes accounted for 48.5 percent of total central tax collection in India.

Why do less people pay tax in India?

India's per capita income is around ₹1.5 lakh (current prices), meaning that an average Indian earns ₹1.5 lakh per year. The basic exemption threshold is almost three times the average per capita income, so a major chunk of the population is not liable to pay taxes. Tax is a crucial source of money for governments.

What is the average tax in India?

The Personal Income Tax Rate in India stands at 42.74 percent. Personal Income Tax Rate in India averaged 33.84 percent from 2004 until 2022, reaching an all time high of 42.74 percent in 2020 and a record low of 30.00 percent in 2005. source: Ministry of Finance, Government of India.

What percent of Indian population pays income tax Quora?

What is the percentage of Indian population that pays taxes and files tax returns? - Quora. The percentage of the Indian population that pays taxes and files tax returns is relatively low. According to the Income Tax Department, only about 1.6% of the Indian population filed tax returns in 2022-23.

Why is direct tax important in India?

Direct taxes display the importance of taxes by reducing income equalities with its progressive tax structure. Citizens are taxed in proportion to their economic circ*mstances, thereby encouraging social and economical equality.

What is the largest source of direct tax revenue in India?

Corporate tax is the single largest source of income to the government of India.

What is direct tax to GDP ratio in India?

“The tax-to-GDP ratio should be at an all-time high next year at 11.7% from 11.6% this year and 11.2% in 2022-23. This is primarily because of direct taxes increasing from 6.1% of GDP in 2022-23 to 6.6% this year and 6.7% next year, which is more equitable,” Mr.

How many people are GST taxpayers in India?

The number of entities registered to pay the Goods and Services Tax (GST) has doubled to 14 million in the six years since its inception, finance minister Nirmala Sitharaman told the Lok Sabha, which passed the Central Goods and Services Tax (Second Amendment) Bill, 2023, to align age and qualification criteria with ...

Why indirect taxes are so high in India?

India has high indirect tax rates primarily because the country relies heavily on indirect taxes as a major source of revenue for the government. Indirect taxes are taxes imposed on goods and services, which are passed on to the end consumer by the supplier or manufacturer.

How many taxes are there in India?

The direct tax includes income tax, gift tax, capital gain tax, etc while indirect tax includes value-added tax, service tax, goods and services tax, customs duty, etc. The Central Government of India imposes taxes such as customs duty, central excise duty, income tax, and service tax.

Who do not pay taxes in India?

What is the highest direct tax rate in India?

The income tax rates range between 0 and 42.74%. What is the maximum income tax^* rate in India? The highest marginal income tax rate in India is 42.744%.

What are the 5 indirect taxes in India?

Examples of indirect taxes are excise tax, VAT (Value added tax), service tax, custom duty, sales tax, entertainment tax and Securities Transaction Tax.

Which state has highest tax collection in India?

How much tax is collected in India last 10 years?

India's net direct tax collection rises by 160% to ₹16,63,686 crore in last 10 years. Central Board of Direct Taxes, on Tuesday, released a new report revealing that the country's net direct tax collections have increased by 160.52 per cent from ₹6,38,596 crore in 2013-14 to ₹16,63,686 crore in 2022-23.

Why billionaires don t pay taxes in India?

Currently billionaires effectively pay far less personal tax than other taxpayers of more modest means because they can park wealth in shell companies sheltering them from income tax, the group said in its 2024 Global Tax Evasion Report.

Do all people pay taxes in India?

Everyone in India who earns or receives an income is subject to income tax.

Does everyone pay tax in India?

Who Needs to Pay Income Tax. Under existing rules of the IT Act, any individual/business with income irrespective of the amount earned is liable to file income tax returns. But, currently tax on income is payable only if the net taxable income for a fiscal exceeds Rs. 2.5 lakh.

Who collects tax in India?

The tax is collected by the Income Tax Department for the central government. Farmers - who constitute 70% of the Indian workforce - are generally excluded from paying income tax in India.