India is witnessing an unprecedented surge in wealth creation. The number of high-net-worth individuals (HNIs) has skyrocketed & and there is also an expansion of the middle-income bracket, signaling a new era of prosperity. From just 44,078 individuals earning over ₹1 crore annually in AY2013–14 to an impressive 2.3 lakh in AY2023–24, the growth trajectory highlights the dynamic shifts in the nation's financial ecosystem. This unprecedented rise in wealth creation is further reflected in the increasing number of income tax returns (ITRs), which more than doubled during this period, indicating a broadening tax base and economic participation.

Not only has the post-pandemic era witnessed the emergence of over 100,000 crore-plus earners, but India's wealth creation story now encompasses diverse geographies and income groups. Tax simplifications and progressive policies have played a pivotal role in democratizing wealth generation, fostering inclusivity, and bridging income inequalities. As India progresses towards a more equitable and prosperous future, the data reflects not just a story of economic resilience but also the growing aspirations of its people.

The Growth of High-Income Earners

There are now more than 220,000 people in India who make more than Rs 1 crore a year. This is an amazing five-fold rise in the last ten years. The number has grown from 44,078 in the assessment year (AY) 2013–14 to almost 2.3 lakh in the AY2023–24. That's not all—in just three years since the start of the COVID pandemic, 100,000 of them have become big earners.

A lot more individual tax returns were filed during this time, from 3.3 crore to over 7.5 crore, which is more than 2.2 times the number that were filed before.

It rose from 49.2% in AY2022-23 to 51% in AY2013-14, but it still only made up about 52% of paid people who reported wages of more than Rs 1 crore. People with an income of Rs 1 to 5 crore made up about 53% of that group. However, as incomes rose, more businesses and professionals joined the group, making the percentage of salaried people drop. Notably, none of the 23 people who reported taxable incomes of more than Rs. 500 crore were salaried, but 19 of the 262 people who reported incomes between Rs. 100 crore and Rs. 500 crore were salaried.

According to a story from The Times of India, only one person reported income of more than Rs 500 crore in the financial year 2013-14. Two other people reported incomes between Rs 100 crore and Rs 500 crore. From 1,812 in AY2022-23 to 1,798 in the most recent assessment year, the number of people who said they made more than Rs 25 crore went down slightly. In the same way, the number of paid people making more than 10 crore rupees dropped by 4.7%, from 1,656 to 1,577.
 

The Expanding Middle Class

In AY2023–24, 52% of tax returns were filed by people with incomes between Rs 4.5 lakh and Rs 9.5 lakh. In AY2013–14, 54.6% of tax returns were filed by people with incomes between Rs 1.5 lakh and Rs 3.5 lakh. One in four returns was between Rs. 5.5 lakh and Rs. 9.5 lakh, while one in five returns was between Rs. 2.5 lakh and Rs. 3.5 lakh.

The group making between Rs. 5.5 lakh and Rs. 9.5 lakh had a bigger share of the gross total income, going from 18% in AY2013-14 to over 23% now. After people with incomes between Rs. 10 and 15 lakh, those with incomes between Rs. 25 and 50 lakh made the next most contributions, with over 12 lakh. Before, in AY2013-14, the Rs 2.5-3.5 lakh group came in second with 12.8% of the market.
 

The Billionaire Boom In India

In the past year, India has made a new billionaire every five days. This has brought the overall number of US dollar billionaires over 300 for the first time. The 2024 Hurun India Rich List says that there are now 334 billionaires in the country, 75 more than last year. India's wealth production is now spread out and less centralized. The news source said that the number of towns on the rich list has grown from 10 at the start of the list's existence to 97 now, up from 95 last year.
 

A Detailed Perspective
According to How Tax Simplification has given a necessary boost to ITR Filing by SBI, the growth seen in the income group above Rs 10 lakh is impressive and worth mentioning. A closer look shows that there has been a clear change in India's middle class, with people's incomes going from Rs 1.5 lakh to Rs 5 lakh in AY14 to Rs 2.5 lakh to Rs 10 lakh in AY24.

One more thing that was written was that 15% of all filers were women. The report says that this change is because of the government's attempts to simplify taxes and use progressive taxation.

"The government's efforts to reach the bottom of the pyramid are clear from the big drop in income inequality and the rise in ITR filings," said Soumya Kanti Ghosh, Group Chief Economic Advisor at SBI.

Impact Of This Income Surge On Indian Economy

The surge in high-income earners and the expanding middle class in India are likely to have a profound impact on the Indian economy. With a growing number of individuals entering higher income brackets, consumer spending is expected to rise significantly, boosting sectors like retail, real estate, luxury goods, and tourism. Increased tax compliance and a broader tax base will enhance government revenues, enabling higher public investments in infrastructure, education, and healthcare. Additionally, the rise in entrepreneurial wealth and decentralization of economic growth to smaller cities can drive regional development and reduce economic disparities. However, this surge also highlights the need to address income inequality and ensure inclusive growth so that the benefits of economic progress reach all sections of society. As India transitions towards a more affluent and diversified economy, these trends can strengthen its position as a global economic powerhouse, provided the growth is managed sustainably.

Conclusion

The evolution of income trends in India over the past decade underscores a profound shift in the nation's socio-economic fabric. The rise in crore-plus earners, coupled with an increasingly diverse and inclusive tax-paying population, paints an optimistic picture of India's financial health. From the burgeoning middle class to the steady rise in female participation in the workforce, these developments signify a balanced and widespread economic advancement.

Moreover, initiatives aimed at tax simplification and efforts to reduce income inequality have catalyzed wealth generation across all strata. The staggering milestone of over 300 billionaires in the country and the growing representation of smaller towns on the rich list highlight a decentralization of wealth, signaling a shift towards shared prosperity. As India continues to navigate its growth journey, these statistics serve as a testament to the country's resilience, adaptability, and potential to achieve equitable economic progress.