India's richest 1% hold more than four-times the wealth held by 95.3 crore people

India's richest 1% hold more than four-times the wealth held by 95.3 crore people who make up for the bottom 70% of the country's population, a report launched at the World Economic Forum at Davos said Monday, flagging well-entrenched inequality in the country.

The report by rights group Oxfam also drew attention on the countries heeding too much to the advice of financial institutions such as the International Monetary Fund and increasing taxes on poor rather than ramping up social programmes and spending to tackle inequality.

“Countries are increasing taxation on poor people, reducing public spending and privatizing education and health, often following the advice of financial institutions such as the IMF. Oxfam recently showed how IMF programmes using this approach in Tunisia, Egypt and Jordan have negatively impacted women, threatening to increase inequality.

“Governments continue to rely on VAT, despite the fact that this is a regressive tax that hits the poor hardest...,” the report said.

Quoting the World Bank statistics that In India, people living on $1.90 a day have a mortality rate of three times the global average, it said, “if $1.90 is too low to achieve basic nutrition or to ensure a fair chance of surviving the first year of life, it should not be described as sufficient to avoid ‘extreme poverty’”.

Nearly half the world, it said, is trying to survive on $5.50 a day or less.

“Many people are just one hospital bill or failed harvest away from destitution. Inequality is one of the major reasons for this; a huge share of global income growth consistently accrues to those at the top, leaving those at the bottom further and further behind”.

Once secured, the fortunes of the super-rich take on a momentum of their own. The wealthiest people can simply sit back and watch their wealth grow, with the help of highly paid accountants who have delivered them an average annual return of 7.4% on their wealth over the last ten years.

“Despite admirably committing to give his money away, Bill Gates is still worth nearly $100bn, which is twice what he had when he stood down as head of Microsoft, it said.

“One reason for these outsized returns is a collapse in the taxation of the super-rich and the biggest corporations because of falling tax rates and deliberate tax dodging. Studies show that the super-rich avoid as much as 30% of their tax liability,” according to Oxfam.