The Ministry of Finance is proposing to develop a draft Law on Personal Income Tax (replacement) to suit reality and meet the requirements of personal income tax (PIT) reform.
What is that reality? Many opinions have been raised and clearly demonstrated that the current family deduction level is outdated and far from life. The existing problems that are no longer suitable must be changed to serve people's lives and promote social progress.
In this project of building the Law on Personal Income Tax (replacement), many proposals are very responsible and convincing, law-making agencies need to pay attention.
First of all, the family deduction for taxpayers is 11 million VND/month. For a person with an income of 11 million VND/month, it is only enough to cover normal living expenses. But with the current living standards, that amount of money is not enough to ensure a decent life, not to mention people's needs are not only food and clothing, but also education, travel, sports, and cultural enjoyment.
Therefore, raising the deduction level for taxpayers to 16-18 million VND/month is appropriate and civilized.
For dependents, the deduction of 4.4 million VND/person/month is no longer suitable, because the cost of living and the cost of children's education have increased compared to many years ago. For a student who wants to study enough to be able to integrate and become a global citizen, the amount of more than 4 million VND cannot take care of our children as well as expected.
For elderly dependents to have a relatively stable life and children to study well, a family deduction of 6-7 million VND would be more reasonable.
But considering reality, it must be close to life, here are cases where the taxpayer or relatives such as parents, spouse, children are sick, have to pay high medicine and treatment costs. If there are medical records, invoices and documents proving the cost of medical examination and treatment, then it can be considered as an amount to reduce personal income tax.
After all, paying personal income tax is a contribution beyond personal expenses. If taxpayers have to pay for expenses due to illness or disaster, they must be deducted. Not to mention they have to borrow money to pay for unexpected disasters.
Collecting personal income tax, but considering all aspects and circumstances to come up with appropriate tax rates and deductions, is a scientific way and ensures humanity in policy and law making.
