Stating that there are 53-54 million tax payers in the country, till date and only 2.4 million people have declared income above 10 lakhs, Chief economic adviser, Arvind Subramanian, on Friday, said the country needs to work on improving that number.
On the eve of the New Year, Prime Minister Narendra Modi said that there are a minuscule minority of people in our country who have declared income exceeding Rs 10 lakh. According to Economic Survey for 2015-16, India’s ratio of taxpayers to voters is “significantly less” as compared to other countries. Ratio of taxpayers to voters is at around 4 per cent at present and it should be higher at around 23 per cent, the Survey said.
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Last year, Subramaniam had said that the survey calls for bringing rich farmers into tax net phasing out tax exemptions. Only 5.5 per cent of the people who earn pay tax and 15.5 per cent of the net national income is being reported to the tax authorities. As an emerging market, India’s tax to GDP ratio is at 16.6%, as a result, which is below that of the emerging market economies of 21 per cent and OECD average of 34 per cent.
He had said that India’s expenditure on human capital, education and health, to the GDP ratio is the lowest among BRICS and lower than the OECD and emerging market economies averages. It is lower than that of comparable per-capital GDP economies of Vietnam, Bolivia and Uzbekistan.