Richest 21 Indian billionaires have more wealth than 700 million Indians

Richest 21 Indian billionaires have more wealth than 700 million Indians

• Since the pandemic begun to Nov 2022, billionaires in India have seen their wealth surge by 121%, or INR 3608 Crore[1] per day in real terms.

January 16, 2023; New Delhi: Just five percent of Indians own more than 60 percent of the country’s wealth while the bottom 50 percent of India’s population possess only three percent of wealth[2], according to Oxfam India’s latest report “Survival of the Richest: The India story”. India’s richest man has seen his wealth soar by 46 percent in 2022. The report shows that a one-off 20% tax on this billionaire’s unrealized gains from 2017–2021 could potentially raise INR 1.8 lakh crores.[3] This is enough to employ more than five million primary school teachers in the country for a year[4]. Oxfam India calls on the Union Finance minister to end this obscene inequality and implement progressive tax measures such as wealth tax in the upcoming Union Budget.

From 2012 to 2021, 40 percent of the wealth created in India has gone to just one percent of the population and only a mere 3 percent of the wealth has gone to the bottom 50 percent[5]. Oxfam India’s latest report which was released on the opening day of the World Economic Forum in Davos, Switzerland reveals that the total number of billionaires in India increased from 102 in 2020 to 166 billionaires in 2022. The combined wealth of India’s 100 richest has touched $660 billion (INR 54.12 lakh crore) – an amount that could fund the entire Union Budget for more than 18 months[6].

"While the country suffers from multiple crises like hunger, unemployment, inflation and health calamities, India’s billionaires are doing extremely well for themselves. The poor meanwhile in India are unable to afford even basic necessities to survive. The number of hungry Indians increased to 350 million in 2022 from 190 million in 2018. The widespread hunger is resulting in 65 per cent of the deaths among children under the age of five in 2022, according to the Union Government’s submission to the Supreme Court[7]. After witnessing mass suffering and death during the COVID-19 pandemic, it was critical that the Government of India took aggressive measures to address injustice and poverty. But it has unfortunately lost the plot. India is unfortunately on a fast track to becoming a country only for the rich." said Amitabh Behar, CEO of Oxfam India.

While the poor face severe hardships, the wealth of the top 10 richest in India stands at INR 27.52 lakh crore  ($335.7 billion an increase of around $110 billion which is an 32.8 per cent rise from 2021)[8]. The wealth of the top 10 richest can finance the Ministry of Health and Family welfare and Ministry of Ayush for more than 30 years or can finance India’s Union education budget for 26 years or can fund the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) for 38 years![9]

Since 2020, the world’s richest 1% have captured almost two-thirds of all new wealth – six times more than the 7 billion people that make up the bottom 90% of humanity. Billionaire fortunes are increasing by $2.7 billion a day, even as inflation outpaces the wages of at least 1.7 billion workers, more than the population of India. Since 2020, for every dollar of new global wealth gained by someone in the bottom 90%, one of the world’s billionaires has gained $1.7 million[10].

India’s banking system demonstrates class bias when it comes to dealing with loan recovery. In Jharkhand, a 22-year-old pregnant woman was crushed under a tractor for not paying INR 10,000 EMI. Instead of protecting poor and vulnerable from dangerous loan recovery tactics, the RBI withdrew its curbs on third party recovery agents. But in the same year, the loans written off by public banks reached INR 11.17 lakh crore which are mostly given to corporates. Hardly 13% of this massive amount has been recovered by the banks.

Over the last 40 years, governments across Africa, Asia, Europe, and the Americas have slashed the income tax rates on the richest. At the same time, they have upped taxes on goods and services, which disproportionately tax the poorest people and exacerbate gender inequality. In India, the report highlights how the Union Government continues to tax the poor and middle class more than the rich. 

While the poor in India continue to be taxed more, the rich benefit from tax exemptions. In 2019, the Central Government reduced the corporate tax slabs from 30% to 22%, with newly incorporated companies paying a lower 15% rate. The projected revenue foregone by the Union Government in 2020-21 in the form of incentives and tax exemptions to corporates was more than INR 1,03,285.54 crores[11]. This is the equivalent to the allocation towards Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) for 1.4 years.

Amitabh Behar, CEO, Oxfam India said, “The country’s marginalised – Dalits, Adivasis, Muslims, Women and informal sector workers are continuing to suffer in a system which ensures the survival of the richest. The poor are paying disproportionately higher taxes, spending more on essentials items and services when compared to the rich. The time has come to tax the rich and ensure they pay their fair share. We urge the finance minister to implement progressive tax measures such as wealth tax and inheritance tax which have been historically proven to be effective in tackling inequality.”

Greater taxation creates an enabling environment for governments to have resources to fund universal public services, climate adaptations and innovations.  A nationwide survey by Fight Inequality Alliance India (FIA India) in 2021 revealed that more than 80% of people in India support tax on the rich and corporations who earned record profits during the Covid-19 pandemic. More than 90% participants demanded budget measures to combat inequality such as universal social security, right to health and expansion of budget to prevent gender-based violence[12].

“It’s time we demolish the convenient myth that tax cuts for the richest result in their wealth somehow ‘trickling down’ to everyone else. Taxing the super-rich is the strategic precondition to reducing inequality and resuscitating democracy. We need to do this for innovation. For stronger public services. For happier and healthier societies" said Gabriela Bucher, Executive Director of Oxfam International. 

Oxfam India is calling on Union Finance Minister to:-

1: Introduce one-off solidarity wealth taxes and windfall taxes to end crisis profiteering.

2: Permanently increase taxes on the richest 1 percent. The finance minister must especially raise taxes on capital gains, which are subject to lower tax rates than other forms of income. And also implement inheritance, property, and land taxes, as well as net wealth taxes.

3. Enhance the budgetary allocation of the health sector to 2.5 per cent of GDP by 2025, as envisaged in the National Health Policy, to reinvigorate the public healthcare system, reduce OOP expenditure and strengthen health prevention and promotion.

4. Strengthen Primary Health Centres (PHCs), Community Health Centres (CHCs) and government hospitals with adequate number of doctors, nurses, paramedics, equipment and other infrastructural requirements as per Indian Public Health Standard (IPHS) norms to make quality health service available within 3 Km radii of peoples’ residence or workplace.

5. Enhance the budgetary allocation for education to the global benchmark of 6 per cent of GDP, as also committed in the National Education Policy. The government must frame a year wise financial roadmap to achieve the 6 per cent mark.

6. Reduce existing inequality in education by spending more on programmes (for example: Pre Matric and Post Matric scholarships) meant for improving educational status of students from marginalized sections (SC/ST/Girls).

7. Ensure workers in formal and informal sector are paid basic minimum wages. The minimum wages should be at par with living wages which is essential for to live a life with dignity.

Please download the full report here - https://www.oxfamindia.org/knowledgehub/workingpaper/survival-richest-india-story 

For any query, please reach out to: abhirr@oxfamindia.org

About Oxfam India:

Oxfam India is a movement of people working to end discrimination and create a free and just society. We work to ensure that Adivasis, Dalits, Muslims, and women and girls have safe violence-free lives with freedom to speak their minds, equal opportunities to realize their rights, and a discrimination-free future.

[1]USD 1 = INR 82 as on 5th December 2022

[2] Credit Suisse Data

[3] Oxfam global report based on the calculation of Forbes data https://www.forbes.com/lists/india-billionaires/?sh=5f4c85b7109b

[4] Oxfam Global report : Estimates of the average yearly salary for a primary school teacher in India vary from $2,579–4,373. Even with the highest estimate, this implies that more than five million teachers could be employed for a year with $21.95bn in tax revenue. Sources: https://www.ambitionbox.com/profile/teacher-salary; https://www.jobted.in/salary/primary-school-teacher; https://collegedunia.com/courses/bachelor-of-education-bed/salary-of-a-teacher-in-india; https://in.talent.com/salary?job=teacher 

[5] Oxfam’s calculation based on Credit Suisse data

[6] Forbes data on billionaires. Total Union Budget 2022-23(BE)= 39.44 lakh Crs.

[7] Mirror Now. (2022, September 29). Centre tells Apex Court: 69% deaths in children under 5 years due to malnutrition. The Economic Times. Retrieved January 4, 2023, from https://economictimes.indiatimes.com/news/india/centre-tells-apex-court-69-deaths-in-children-under-5-years-due-to-malnutrition/videoshow/94537730.cms

[8] Forbes billionaire data

[9] Richest 10 billionaires from Forbes data- 27.52 Lakh Cr. Total Education Budget 2022-23(BE) : INR 63,449 Cr(Dept. of School Education & Literacy) plus INR 40828Cr(Dept of Higher education) = INR 104277Cr. Source : Union Budget . Total Health Budget (MoHFW + Ministry of Ayush) is 89251 Crs. Total NREGS Budget : INR 73,000Cr

[10] Oxfam Global Report

[11] The New Indian Express. (2022, August 14). In first two years of corporate tax cut, Govt suffers Rs 1.84 lakh crore loss. The New Indian Express. Retrieved January 5, 2023, from https://www.newindianexpress.com/business/2022/aug/14/in-first-two-years-of-corporate-tax-cut-govt-suffers-rs-184-lakh-crore-loss-2487445.html

[12] https://www.fightinequality.org/news/every-8-out-10-indians-want-tax-rich#:~:text=New%20Delhi%3B%20January%2027%2C%202022,(FIA%20India)%20has%20revealed.