Authors: Dr.Muddagangaiah KC
Abstract: This paper examines the influence of progressive income taxation on income disparity in India, a nation experiencing rapid economic growth alongside widening socio-economic disparities. Progressive taxation is designed to levy higher rates on individuals with higher incomes, aiming to redistribute wealth and fund public services for lower-income groups. While theoretically effective, its practical impact in India is constrained by tax evasion, a large informal economy, and structural inefficiencies within the tax administration system. This study reviews empirical evidence from Indian government reports, peer-reviewed journals, and international studies to assess the extent to which progressive taxation reduces income disparity. The findings indicate that while progressive taxation has potential, systemic challenges limit its effectiveness. The study proposes policy reforms, including tax simplification, broadening the tax base, improving enforcement, and raising public awareness to enhance the redistributive impact of the tax system.
DOI: http://doi.org/10.5281/zenodo.17606786
