Economic ‘horror’ factor: 40 % of national wealth in pockets of 1% money spinners

By Abhijit Roy

Ahead of the World Economic Forum’s annual meeting in Davos, an Oxfam International’s latest study ‘Survival of the richest’ revealed that India’s richest one per cent hold 40 per cent of the country’s total wealth. At the same time, the lower class has only three percent of the total share. The annual inequality report released by Oxfam says that if the country’s 10 richest people were taxed five per cent, all children could be paid enough to go back to school. Even a one-time tax on the profit earned by the country’s richest person during 2017-21 can raise Rs. 1.79 lakh crore. This amount would be sufficient to provide one year’s employment to more than million teachers of Indian primary schools. At the same time, the report estimates that if a one-time tax is imposed on the wealth of India’s billionaires at the rate of two per cent, then this amount can meet the need of Rs. 40,423 crores for the nutrition of the malnourished people in the country for the next three years. The report further states that the one-time tax of five per cent on the country’s ten richest billionaires, which works out to about Rs 1.37 lakh crore, is more than one and a half times the budget of the country’s Ministry of Health and Family Welfare and Ministry of AYUSH for 2022-23. Undoubtedly, these organizations with the influence of developed countries have vested interests behind issuing such reports, but still these statistics paint a picture of social inequality. The report states that women workers in India get only 63 paise for every rupee of wages earned by male workers. This gap is more for rural laborers and deprived sections. The report says that the minimum wage should be sufficient to live on. Oxfam has incorporated both qualitative and quantitative aspects to assess the impact of inequality in India. The report shows that poor people pay more taxes in proportion to the rich. They have been spending more on essential goods and services. Also that the time has come to tax the rich and ensure that they are paid. The report suggests that the country’s finance minister implement progressive measures such as wealth-tax and inheritance tax, which have proved effective in removing inequality in various countries. Quoting a nationwide survey conducted by Fight Inequality Alliance India in the year 2021, Oxfam said that eighty per cent people support imposing additional tax on the rich and companies who made huge profits turning the Covid crisis into an opportunity. Ninety percent of respondents demanded increased budgets for social security, the right to health, and to prevent gender-based violence and address inequality. It is certainly time to bust the myth that tax breaks for the rich lead to economic growth. Undoubtedly, in order to remove inequality in the society and to strengthen democracy, it is necessary that capital gains and big rich should be taxed in a just manner. Along with this, the budget for education and health should be increased according to the global standards. Only then strong public services will pave the way for a healthy and prosperous society.

(Author is a columnist. The views expressed are personal opinion of the author. He can be reached at abhijitroytatanagar@gmail.com)