income tax returnImage Credit source: AI
In India, the number of people showing annual income of more than Rs 1 crore has increased rapidly. At the same time, there has not been much increase in the total number of people filing income tax returns. This makes it clear that most of the declared income of the country is with the upper class people only. According to data from the Income Tax e-filing portal, the number of people declaring income of more than Rs 1 crore has increased by about 22 percent in FY26. This increase is also important because during this period the total number of return filers has increased by only 1 percent.
December 31, 2025 was the last date for filing income tax returns for assessment year (AY) 2025-26. However, updated returns can be filed till March 31, 2030. According to the data, more than 9 crore returns were filed between April 1 and December 31 in FY26, while 8.92 crore returns were filed in the same period of FY25. That means there has been a slight increase of only 1.22 percent. These figures include e-returns of different assessment years, but most are for the current year only.
change in income
Where the increase in the total number of return filers remained slow. At the same time, a big change has been seen in the pattern of declared income. There has been a decline in the number of people showing income up to Rs 5 lakh, while all income categories above Rs 5 lakh up to more than Rs 10 crore have increased by double digits. The four highest income categories ranging from Rs 50 lakh to more than Rs 10 crore have recorded an increase of more than 20 percent in each. The special thing is that the fastest growth has been seen in the highest earning categories.
upper class trends
In the report of The Hindu Business Line, tax experts say that this increase is not due to any data error, but is the result of strong earnings of the upper class and better tax reporting. Sandeep Bhalla, partner of Dhruva Advisors, said that the reason for this is the intensification of economic activities in the country. According to Bhalla, there has been a clear improvement in the income of upper class families. The reason for this is increase in salary, good bonuses and better profits from business.
AKM Global partner Sandeep Sehgal also agreed with this in the report. He said that despite only a 1 percent increase in total returns, the nearly 21 percent increase in millionaire taxpayers shows that people with high incomes are now entering the tax system in a more efficient manner. Sehgal said that strict reporting rules, greater use of data analytics and systems like AIS and TDS/TCS have increased transparency. Due to this, cases of hiding income have reduced. According to him, this increase reflects better tax compliance rather than creation of new wealth.
These states won
In the last four years, the number of tax payers has increased rapidly in many states. This indicates increase in economic activities and tax base in the states. According to the data, Haryana has been at the forefront in this matter. There were 6.03 lakh taxpayers here in 2020-21, which increased to 10.86 lakh in 2024-25. That means there has been an increase of about 80 percent.
Gujarat stood second, where the number of tax payers increased from 11.03 lakh to 19.05 lakh, which is an increase of about 72.7 percent. The number of taxpayers in Bihar increased from 3.89 lakh to 6.34 lakh. At the same time, in Chhattisgarh this number increased from 1.87 lakh to 2.99 lakh and in Telangana it increased from 8.27 lakh to about 13 lakh. This entire trend shows that the scope of the formal economy is continuously increasing in different states.
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