India is making remarkable progress in achieving equitable, collective prosperity: PM Modi

Prime Minister Narendra Modi hailed the reports highlighting the average income of the middle class has risen over the years, saying that India is making remarkable progress in achieving equitable and collective prosperity. Citing the research of SBI titled ‘Deciphering Emerging Trends in ITR Filing: The Ascent of the New Middle Class in Circular Migration, the PM pointed out that the weighted mean income has made a commendable leap in the last 9 years, from Rs 4.4 lakh in AY14 to Rs 13 lakh in FY23. The SBI report also highlighted that our smaller states and that too from the Northeast, namely Manipur, Mizoram, and Nagaland, have exhibited an admirable growth of over 20 per cent in ITR filings in the last 9 years, he said. “This shows that not only have incomes risen but so has compliance. And, this is a manifestation of the spirit of trust that the people have in our government. These findings not only reflect our collective efforts but also reiterate our potential as a nation. Growing prosperity augurs well for national progress. Undoubtedly, we are standing at the cusp of a new era of economic prosperity and are on course towards fulfilling our dream ‘Viksit Bharat’ by 2047,” he said. The average income (weighted mean) has grown from Rs 4.4 lakh in the financial year 2012-13 (FY13) to Rs 13 lakh in FY22. According to the report, the reasons for this are twofold. One, many taxpayers have transitioned from the lower-income group to the upper-income group, thereby bumping up the average. Two, there has been a fall in the number of return filers with zero tax liability. PM Modi also cited a study of ITR data done by Anil Padmanabhan, a noted journalist which highlighted the positive performance in terms of increase in income tax filings across states. When comparing ITR filings between 2014 and 2023, the data paints a promising picture of increased tax participation across all states, the PM wrote in a blog on LinkedIn. For instance, ITR data analysis shows the state of Uttar Pradesh has emerged as one of the top-performing states when it comes to ITR filings, he wrote, adding that in June 2014, Uttar Pradesh reported a modest 1.65 lakh ITR filings, but by June 2023, this figure had skyrocketed to an impressive 11.92 lakh. As per the report, the average income is expected to go up further to Rs 49.70 lakh by 2047, helped by a combination of more tax filers and a shift in the distribution of tax filers from the lower to the higher income group. Also, 25 per cent of the ITR filers are expected to leave the lowest income strata (annual income of up to Rs 5 lakh) by FY47, SBI Research estimates.