Income tax data for 2024-25 has revealed unexpected disparities in India’s middle class, with Jharkhand outperforming Gujarat in the proportion of higher-earning taxpayers.
The findings show that Maharashtra continues to dominate in the number of high-income earners, while Karnataka has produced the largest share of so-called ‘lakhpatis’. Most taxpayers across India, however, still earn less than ₹7.5 lakh annually.
The analysis of income-tax returns filed by businesspersons and professionals for the assessment year 2024-25, highlighted sharp contrasts between states often regarded as wealthy and those considered less prosperous.
In a striking example, 20 pc of taxpayers in Jharkhand declared annual incomes between ₹12 lakh and ₹50 lakh. In Gujarat, a state closely associated with prosperity and industrial growth, only 7 pc of taxpayers fell into the same bracket.
Gujarat also failed to feature among the top 10 states with the highest number of individuals earning between ₹25 lakh and ₹50 lakh, while Maharashtra led the category.
The report further underlined that the majority of Indian taxpayers earn far less, with most declaring annual incomes between ₹2.5 lakh and ₹7.5 lakh. More than half of the middle class falls into this range, while only 2.5 pc reported incomes above ₹25 lakh.
The figures underscore how small India’s upper-middle income segment remains.
Maharashtra topped the list of high-income earners, with nearly 1.4 lakh people declaring annual incomes between ₹25 lakh and ₹50 lakh. Karnataka and Tamil Nadu followed in second and third place.
Karnataka also distinguished itself by producing the highest proportion of ‘lakhpatis’, with more than 20 pc of its tax filers earning between ₹12 lakh and ₹50 lakh. In contrast, Gujarat lagged at the bottom, with even Bihar recording a stronger share in this category.
Delhi stood apart in terms of the taxpayer share. While Maharashtra had the largest absolute number of tax returns filed at over 46 lakh, Delhi registered the highest proportion of taxpayers relative to its population.
Across India, around 3 pc of a state’s population typically files taxes. In Uttar Pradesh, the country’s most populous state, the proportion is only 1.5 pc, despite it having the second-highest number of returns.
The data reveals the uneven spread of India’s middle class. States such as Jharkhand and Karnataka are emerging with stronger proportions of higher earners, while traditional economic powerhouses like Gujarat are slipping behind in this specific income band.
At the same time, the figures reaffirm that the vast majority of India’s middle class continues to live on less than ₹7.5 lakh a year, reflecting the limited scope for upward mobility across the country.
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