Budget special: 1.6% of Indians pay 55% of total tax collected
1. Direct Taxes
I have been saying this for a while that 1.6% of Indians pay 30% of total taxes collected. How?
Source:
1.6% pay direct taxes
Direct tax to total tax collected was 56.72%
Personal Income taxes are 1022325/(1022325+922675) = 53% of total direct taxes ⇒ Individuals pay more in taxes than corporates
So net-net, total direct tax contributed to the GOIs tax kitties by 1.6% individuals = 56.72% * 53% = ~30%
2. Indirect taxes
But hold on, I did something more today. I tried guesstimating and adding the Indirect taxes that these 1.6% Indians pay.
I used chatGPT for this. I am pasting the guesstimate below
Total tax collected in 2023 = ₹23.27L crores (source: https://pib.gov.in/PressReleaseIframePage.aspx?PRID=2022351&utm_source=chatgpt.com )
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Now presume that 30% of all the tax collected above came from personal income tax. These direct tax payers would have also contributed to Indirect taxes (GST etc.). Presuming the total tax collected as ₹23.27L crores, can you guesstimate how much indirect taxes was paid by these direct tax paying individuals? Please make relevant and reasonable assumptions wherever applicable.
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Step 1: Direct Taxes Paid by Individuals
Given that 30% of total taxes came from personal income tax:
30% of ₹23.27 lakh crore ≈ ₹6.98 lakh crore
Step 2: Spending Assumptions for Personal Income Tax Payers
- Savings vs. Consumption:
- Assume personal income tax payers save around 30% of their post-tax income.Therefore, they spend 70% of their income on taxable goods and services.
- Income Calculation:
- The tax rate for individuals in India varies but typically averages around 15% effective tax rate on total taxable income for this segment.Estimated total income for these taxpayers: ₹6.98 lakh crore ÷ 15% ≈ ₹46.53 lakh crore
- Spending on Taxable Goods: 70% of ₹46.53 lakh crore ≈ ₹32.57 lakh crore
- GST Assumption: Assume an average GST rate of 18% on taxable spending.
Step 3: GST Paid by Direct Tax Paying Individuals
18% of ₹32.57 lakh crore ≈ ₹5.86 lakh crore
As a percentage of total taxes this comes to 5.86/23.27 = 25%
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3. Total Direct + Indirect taxes paid by 1.6% individuals
= 30% (from 1 above) + 25% (from 2 above). Even if you were to soften out the guesstimate 25% by 20%, it comes to 50%
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So, net-net, 1.6% of direct tax paying individuals are contributing to over half of the taxes collected every year, when more than 98.5% of citizens live as if they live in Dubai/Middle-east - paying 0% direct taxes!
And what do you get in lieu of this? Zilch ⇒ potholed roads, garbage-infested cities, cancerous high AQI polluted air, rampant noise pollution, choked infrastructure, rampant grassroots corruption, high inflation, unaffordable housing/living, european level taxation for sub-saharan services, revadis, joomla schemes like Namami Gange/Min govt, max governance, unfettered gundagardi, monopolistic favoritism shown to Ambanis/Adanis, etc
As 1.6%, you can't influence votes, you can't escape the filth/corruption etc. heck this god-forsaken nation, can't do nothing!
We are only but a golden goose who is to be exploited to extract the golden egg every year. 1947 changed nothing. Only our ruling class changed from white skinned rulers to brown skinned thugs!
Too much power is concentrated in the hands of the ruling elite and that's how it is going to be for the next 3-4 decades - heck for the next 100 years atleast. We will continue to be a developing nation forever, while the politicians will keep sending their kids abroad, gathering generational wealth https://timesofindia.indiatimes.com/education/web-stories/10-politicians-whose-children-pursued-higher-education-abroad/photostory/114432729.cms
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If you as a direct-tax paying honest citizen, have the means and opportunity to do so, RUN AWAY from this democratic mockery of a social experiment that we call as India! Save yourself and your coming generations from this slavery, exploitation!
If you can't run away, then please NON COOPERATE. Spend only on essentials and avoid splurging on everything else. I am running my own little NON COOPERATION movement 2025 by only spending on essentials.