Income inequality shrinking: SBI

New Delhi: Income inequality in India has declined, with more than a third of taxpayers moving to higher Income-Tax (I-T) buckets, while top taxpayers’ contributions declining, the Economic Research Department of SBI said in a report, rebutting talks of K-shaped post-pandemic recovery.

In a K-shaped recovery, some parts of the economy may experience strong growth while others continue to decline. Some economists, including former RBI governor Raghuram Rajan, have often referred to India’s post-pandemic economic growth as K-shaped. SBI research paper said the K-shaped recovery seems “at best flawed, prejudiced, ill-concocted and fanning interests of select quarters to whom India’s remarkable ascendance, signalling more the renaissance of the new global south, is quite unpalatable”.

“Income inequality captured through the Gini coefficient (one of the most widely used measures of income inequality) of taxable income has declined significantly from 0.472 to 0.402 during FY14-FY22,” it said.