India’s economy is based on Domestic consumption instead of exports. If you tax its middle class (which is people above that income). Then consumption tanks entirely, They used to tax from a much lower rate at 7lakhs per annum and it was actively crushing their domestic consumption markets.

They’ve been trying to revive and boost their declining consumption economy. India’s 10% population drives >50% of entire consumption, >80% of entire retail goods consumption outside of base essential commodities.

Trust is low corruption high and a lot of people just don't pay taxes -- historically https://www.bbc.com/news/world-asia-india-37530290