Propose two options for deductions, calculated from actual costs
At the regular press conference for the first quarter of 2026 of the Ministry of Finance, Mr. Luu Duc Huy - Deputy Director of the Department of Tax, Fee and Charge Policy Management and Supervision - said that the Ministry has issued Document No. 3715 dated March 26, 2026 to ministries, branches, localities, associations and publicly posted to solicit opinions on the draft decree, after Law No. 109 was passed by the National Assembly and is expected to take effect from July 1, 2026.
According to Mr. Huy, the draft decree proposes two options for deducting medical and educational expenses. The first option identifies a deduction of about 20 million VND/year for healthcare and about 21 million VND/year for education, totaling 41 million VND/year. The second option raises the deduction to 23 million VND/year for healthcare and 24 million VND/year for education.
These levels are built on the basis of actual spending statistics. In 2024, the average expenditure for people's healthcare is 3.5 million VND/person/year, of which accommodation costs are about 10.2 million VND/person/year. For education and training, the average expenditure level is 9.6 million VND/person/year. With a taxpayer-to-dependent person ratio of about 0.8, the drafting agency estimates that healthcare costs are about 20.4 million VND/year and education is about 19.2 million VND/year.
On that basis, option 1 is designed to be closely corresponding to the average spending level, in which the health deduction level is about 2 times higher than the average boarding cost, and education is about 2.2 times higher than the actual average spending level. Currently, the Ministry of Finance is summarizing opinions to complete the draft before submitting it to competent authorities.
Income of about 28 million VND/month not yet taxable
Mr. Luu Duc Huy said that if option 2 is chosen, the policy is expected to reduce budget revenue by about 7,697 billion VND per year. However, in return, people's tax obligations will be significantly reduced.
For taxpayers with 1 dependent, an income of about 28 million VND/month is still not subject to personal income tax. Only from about 28.63 million VND/month or more, taxpayers will begin to pay tax for the excess income, with a tax rate of 5% and the amount of tax incurred at a very small level.
He emphasized that this policy clearly shows humanity when reducing tax payment obligations for people.
Regarding concerns about the feasibility of requiring invoices and documents for health and education expenditures, a representative of the Ministry of Finance said that this must be implemented in accordance with the law on tax management.
According to the provisions of Decree 123 and Decree 70 of the Government, business households with revenue of 1 billion VND or more must use invoices. For the health and education sectors, which are conditional business sectors, compliance with the invoice and document regime is mandatory.
Also according to Mr. Huy, since the application of electronic invoices, all transactions from 1 VND or more must issue invoices, instead of the threshold of 200,000 VND as before when paper invoices were still used. In addition, new policies also require business households to fully implement books and documents according to regulations.
According to Mr. Huy, there is no reason for people when paying tuition fees or medical examination and treatment costs not to be issued invoices and documents to serve as a basis for personal income tax finalization. If the unit does not comply with the regulations, it will be penalized according to legal regulations.
