Individuals earning a similar income (after adjusting for purchasing power parity and exchange rates) in other emerging nations are taxed much less.

India's neighbours, Pakistan and Bangladesh, levy a 20 per cent tax on their middle classes. The Economic Times survey found that after making the required adjustments, even developed nations had lower tax levels than India.

For example, Malaysia, Indonesia, Hong Kong, Singapore, Thailand, Argentina and New Zealand all levy under 20 per cent tax for a person with a US$4,000 income. In the UK, it is 22 per cent, in China 25 per cent.

The only country with a higher tax rate than India's is South Africa, which topped the charts at 32 per cent.

So India's salaried bourgeoisie is shelling out much more than its counterparts elsewhere.

What infuriates the 285 million middle-income earners is not just the level of tax, but how little they get from the government in return by way of public or social services. All Indians who are not at the bottom of the heap end up paying for basic facilities that in other countries are provided by the government.

Prolonged power cuts mean that the Indian middle class has to buy battery-charged 'inverters' or generators to keep lights and fans going in blistering summers.

Telephone lines are installed and repaired usually only after a bribe. Government schools are so atrocious (absentee teachers stay at home, preferring to give lucrative private tutorials rather than attend school) that parents send children to private schools.

And government hospitals are so indescribably filthy (a recent newspaper photograph showed an open drain in the middle of a New Delhi hospital ward) that middle-class Indians who value their health prefer to go private. 'Where does all my tax go?' asks Arti Puri, a property dealer.

'Politicians just eat it all up and do nothing for us. It doesn't even go to the poor. I pay my taxes, but I don't blame those who evade tax because no one benefits except corrupt politicians and bureaucrats.'

Mrs Puri has a point. A vast proportion of the government's income is spent on paying the salaries and pensions of a bloated bureaucracy that keeps swelling every year, while the amount invested in infrastructure and social services is dismal.

About 58 per cent of the British government's spending is on social services. America's share is about 55 per cent while Malaysia's is about 43 per cent. India's share is 9 per cent. It stands to reason that tax evasion is a national pastime, pursued with energy, craft, and cunning.

When the Finance Ministry offered an amnesty to tax dodgers a few years ago along with a promise of confidentiality, it was stunned at the money that poured in - US$2.5 billion, well above the US$1 billion target - and the number of people who came clean with such enthusiasm.

Businessmen declared bullion, jewellery, and property; a former political leader owned up to gold crowns; a Calcutta family coughed up almost two tonnes of silver coins and utensils; and a New Delhi resident paid tax on an elephant which had escaped the taxman's noose for years.

Only about 2 per cent of the Indian population pays tax. And this is not the richest 2 per cent, which is largely comprised of business people who carry out cash transactions, keep no receipts and dodge taxes.

Inevitably, it is salaried professionals, whose pay cheques make them sitting targets, who contribute most to the exchequer. Given the tiny tax base, it is not surprising that the ratio of government tax receipts to gross domestic product was only 14 per cent in 1999-2000.

Compare this with tax to GDP ratios of more than 40 per cent in most developed countries, and above 30 per cent in most of Asia.

Experts have long lobbied for the need to widen India's tax base to bring in more people, particularly the rural rich who seem to escape the tax net altogether.

In fact, just last month, the IMF urged the government to strengthen its tax revenues and improve tax collection as part of measures to cut its massive debt. This currently stands at over 80 per cent of GDP, a cause of great concern to the IMF.

'By widening the net and bringing more people in, the government can reduce the rates. This will encourage people to pay up rather than face the hassle of avoidance,' says economist V A Panandiker.

It is also safe to say that more Indians would be willing to file their income tax returns if they could see their hard-earned money being better spent than it is at present.

For that, the government needs to increase its social spending and ruthlessly slash the bureaucracy.

Graphic: indrevgbz