New Delhi: Every year in India, around the tax filing season, discussions among the salaried and business class intensify regarding the tax rates and the facilities available in return. Recently, a post by a founder and entrepreneur is going viral on the social media platform X (earlier Twitter), in which he has shared the details of the huge tax paid by him during the financial year. The person revealed that he has paid income tax of ₹1,14,00,000 (Rs 1.14 crore) in just one financial year.
However, the pain and frustration he expressed after paying his taxes has caught the attention of middle- and upper-income taxpayers across the country. He says that even after paying such a large amount of taxes, he never feels like he owns his earnings.
After all, why did the entrepreneur say this?
In the viral post, the businessman expressed his frustration with India’s current tax structure and the returns (government benefits) he receives after paying taxes. According to him:
Feeling of low earnings: Around 30% to 39% of the total earnings (including surcharge and cess) goes directly to the government in the form of direct tax.
Double burden of indirect taxes: When they buy a car, property or daily use items from the money left after paying taxes, they have to pay GST of 18% to 28% and other local taxes separately.
Lack of amenities: The man’s pain was that despite contributing millions of rupees, he and his family lack access to the same amenities as European or developed nations in terms of roads, health, education, or infrastructure. They have to pay extra for private hospitals, private schools, and toll roads.
“When you pay almost half of your hard-earned money in taxes and in return have to spend less on every basic necessity, it doesn’t feel like you’re earning for yourself. It feels like you’re an unofficial partner of the government, where the profits are yours and all the risk is yours.” — Viral post by taxpayer
Social media reactions: Internet divided into two factions
As soon as this post came out, mixed reactions of users are being seen on social media:
Support for taxpayers: Most salaried and business users agreed. They said that the “extreme minority” (top 1%) of honest taxpayers in India don’t receive any special social security or retirement benefits.
The other side: At the same time, some users believe that in a developing country like India, tax collection is very important for infrastructure development (like highways, railways and defence budget).
Direct Tax Structure in India
Currently, India has a basic tax rate of 30% on the highest income slab under both the old and new tax regimes. A surcharge and a 4% health and education cess are added on top of this, significantly increasing the overall tax margin for high-income individuals.