Raising the tax exemption threshold for business households to 200 million VND/year
One of the most important contents of the draft is to adjust regulations on taxable income and tax-exempt income, especially for business households, securities, real estate, inheritance, and gifts.
According to current regulations, individuals with a revenue of VND 100 million/year or less do not have to pay personal income tax (PIT). However, many localities such as Quang Nam, Khanh Hoa, Ha Tinh, Bac Giang, Tra Vinh, Da Nang have proposed raising this level to 200 million VND/year to synchronize with the Law on Value Added Tax.
The Ministry of Finance has accepted this proposal, saying that increasing the taxable revenue threshold will help reduce pressure on small and medium-sized business households, while accurately reflecting the increasing reality of business costs.
Exemption from tax for some special income groups
The Ministry of National Defense proposes to exempt tax on income from research, design, and production of weapons and equipment for national defense and security to encourage high-quality human resources to participate in this field.
The Ministry of Foreign Affairs recommends not to calculate taxes on living expenses and allowances of Vietnamese agency members abroad, because this is a necessary support to ensure the lives of overseas workers.
The Ministry of Agriculture and Rural Development proposes to exempt personal income tax on joint stock profits of agricultural cooperative members and individuals investing in large fields, planting production forests, and aquaculture to encourage sustainable agricultural development.
Income from securities and real estate transfers
The Ministry of Finance affirmed that it will study and adjust the tax calculation method for securities, ESOP shares, and income from financial investment to ensure fairness, avoiding investors being unreasonably taxed.
Some localities also proposed reviewing income tax rates from real estate transfers to suit market reality, avoiding difficulties for people.
Adjust the family deduction level to suit the reality
Currently, the family deduction is 11 million VND/month for taxpayers and 4.4 million VND/month for dependents. This level has been applied since 2020, but many opinions say it is outdated compared to the economic growth rate and consumer price index (CPI).
Proposals to increase the family deduction level
Ninh Thuan Provincial People's Committee: Proposal to increase to 16 million VND/month for taxpayers and 6 million VND/month for dependents.
Ha Tinh Provincial People's Committee: Proposal to increase to 18 million VND/month for taxpayers and 8 million VND/month for dependents.
Ministry of Information and Communications: Propose to calculate the family deduction level by region, similar to the regional minimum wage to ensure fairness between localities.
The Ministry of Finance is studying these proposals and at the same time considering assigning the Government to adjust the family deduction level annually or every two years, instead of waiting for the CPI to increase by 20% to adjust as at present.
Amending progressive tax rates to reduce pressure on workers
Currently, personal income tax is calculated according to the 7-level progressive tax table, of which the highest rate is up to 35%. However, many opinions say that this tax rate is unreasonable, causing great pressure on workers, especially those with a good average income in big cities.
Proposals on the new tax table
Thai Nguyen Tax Department: Proposal to reduce the tax rate to 5 levels to simplify the tax system.
Ministry of Agriculture and Rural Development: Proposal to reduce tax rates for low-income people, increase taxes for higher-income groups to ensure fairness.
Business community: Proposal to consider adjusting tax rates for workers with an income of 10 - 30 million VND/month, because this is the group most affected by progressive taxes.
The Ministry of Finance is considering adjusting this tax table in the direction of reducing pressure on low-income groups, expanding the gap between tax levels to ensure fairness and consistency with reality.
After synthesizing comments, the Ministry of Finance affirmed that it will accept reasonable proposals to complete the draft Law on personal income tax (replacement).
