Country's bottom 50% of consumers face same GST burden as mid-30%

INDIA'S BOTTOM HALF of consumers face the same Goods and Services Tax (GST) burden as the middle 30%, according to a new study that analyses the impact of the indirect tax regime using the statistics ministry's Household Consumption Expenditure Survey (HCES) for 2022-23.

- SIDDHARTH UPASANI

The study found that the bottom 50% of Indian consumers living in rural areas bore 31% of the GST burden—the same as the middle 30% of rural consumers. The figures were similar for urban areas: the bottom 50% faced 29% of the burden, while the middle 30% bore 30%. In both cases, the top 20% of consumers had to bear the bulk of the tax burden: 37% in rural areas and 41 percent in urban.

As per the 2022-23 HCES, the bottom 5% of consumers in rural areas had an average Monthly Per Capita Expenditure (MPCE) of ₹1,373, with the figure being ₹10,501 for the top 5%. The corresponding numbers for urban consumers were ₹2,001 and ₹20,824, respectively. The tax burden is the share of the GST estimated to have been paid by households.

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