Who Pays How Much GST in India

Abstract

This study critically evaluates Oxfam's claim that the poorest citizens in India bear most of the Goods and Services Tax (GST) burden. Despite gaining significant media attention following its presentation at the World Economic Forum in Davos, Oxfam's assertion lacks robust empirical support and suffers from several methodological shortcomings. This paper presents a comprehensive analysis of GST contributions across different income groups by leveraging detailed consumption data from the National Sample Survey Office (NSSO) and applying precise GST rates. The findings reveal that the bottom 50% of the population contributes only 9.6% of the total GST revenue and 28.1% of the GST contributed by Households, contrary to Oxfam's claim of 64.3%. In contrast, the top 20% contributes 41.1% of Household GST contribution and 14.2% of Total GST, reflecting the progressive nature of GST. This analysis underscores the need for accurate data and rigorous methodology in shaping public policy discourse, as misleading narratives can distort perceptions of economic fairness and influence policy decisions.