'1 person working for 50': Finfluencer questions India’s broken tax burden

What happens when just 2% of people fund an entire country’s income tax system? According to Akshat Shrivastava, founder of Wisdom Hatch and a popular finfluencer, it’s like “one person working for a family of 50.” 

In a post on X, Shrivastava argued that India collects enough taxes from just 2% of its population — and nothing from the remaining 98%. The burden on a small minority, he suggests, becomes unbearable when taxpayers are confronted with “massive corruption, lazy people unwilling to work… and poor quality of life.” The result, he says, is deep frustration.

India’s skewed tax structure is a product of several long-standing policies and economic realities. Over 40% of India’s workforce is engaged in agriculture — a sector that remains exempt from income tax, a colonial-era policy that still holds. 

A significant chunk of the population also earns below the taxable threshold. As per the latest slabs for FY2025–26, income up to ₹2.5 lakh under the old regime and up to ₹3 lakh under the new regime attracts no tax, effectively keeping nearly 70% of the population outside the tax net. 

Even among those who do file returns, many end up paying nothing. In FY2020–21, of the 6.76 crore individuals who filed returns, 4.46 crore paid zero tax — a striking 67.3% filing nil returns due to exemptions and deductions. In addition, estimates suggest that 30–40% of those who should be paying taxes are either underreporting or not filing at all.

The result is a deeply concentrated tax base. Only 0.68% of the population pays effective income tax. Among those within the tax system, just 91 lakh individuals — about 10.3% — report taxable incomes above ₹9.5 lakh, putting them in what is considered the “well-off” category. 

Meanwhile, income tax contributes around 19% of the government's total revenue, with the rest coming from indirect taxes like GST, customs, and excise duties — which are paid by everyone, regardless of income level. 

Even those who don’t pay income tax still contribute to government coffers every time they make a purchase or pay a service charge.

Still, Shrivastava’s post brings the focus back to income tax payers — particularly the salaried middle class — who are estimated to contribute between 70–80% of India’s total income tax revenue.