The wealthier the Indian families are, the lesser the income they report relative to their wealth, a paper by Ram Singh, Delhi School of Economics (DSE) director and a permanent member of the Monetary Policy Committee of the Reserve Bank of India, reveals, suggesting that wealthier families under-report their income.
“On average, the total income reported by the bottom 10 percent of individuals is more than 120% of their wealth; for the wealthiest five percent of individuals, it is just about 3.7 percent of their wealth”, the paper, Do the Wealthy Underreport their Income?, states.
The study gives insight into the stark reality of rising inequality in the country where Indians with means remain better placed to under-report their income, for instance, by under-reporting their rental income, or disguising their taxable income as tax-free, than Indians with lesser means.
by Udit Bubna