Personal Income Tax Law to be amended in 2025

Many issues of concern to people and businesses were informed by representatives of the Ministry of Finance at the press conference.

Tax and fee support policies contribute to the gradual growth of the economy

At the press conference, reporters asked questions about whether the Ministry of Finance would continue to propose policies to relax and reduce taxes, fees and charges for people and businesses, said Mr. Truong Ba Tuan, Deputy Director of the Department of Management, supervisor of tax, fee and charge policies (Ministry of Finance), said that in the recent period, in the context of a difficult economy, the Ministry of Finance has coordinated with ministries, branches and localities to advise the Government, submitt to the National Assembly Standing Committee to promulgate according to its authority many solutions to support people and businesses, including solutions to exempt, reduce, and extend tax payment deadlines on a large scale.

In 2024, based on consideration and assessment of the economic situation, along with related factors, the Ministry of Finance has advised the Government to submit to the National Assembly Standing Committee measures to continue reducing environmental protection taxes for petroleum; Simultaneously, advise the National Assembly Standing Committee to promulgate a policy to reduce VAT by 2% on some goods and services as applied in 2023.

The implementation of solutions to support businesses and people in recent times by the Ministry of Finance has received the agreement and support of businesses and people, contributing to the gradual growth of the economy.

According to Mr. Truong Ba Tuan, in the immediate future, the Ministry of Finance continues to focus on drastically implementing the solutions approved by the National Assembly and the National Assembly Standing Committee; At the same time, closely monitor developments in the socio-economic situation and related issues to research, advise and propose policy solutions on budget revenue, thereby having appropriate tax policy solutions to remove difficulties for businesses and people, and promote economic growth.

As for the 2% VAT reduction policy, the National Assembly's Resolution assigned the National Assembly Standing Committee to evaluate the policy implemented in recent times.

For more information on this issue, Deputy Minister of Finance Nguyen Duc Chi said that the policy of reducing VAT by 2% is being implemented. In the coming time, the National Assembly also assigned the Government to report on results, evaluate the implementation of the VAT reduction policy and propose solutions. The Deputy Minister emphasized that support policies must ensure "harmonious benefits and shared risks".

Monitor developments in the CPI index to proactively propose family deductions

Also at the press conference, answering reporters' questions about the issue of considering increasing family deductions for taxpayers, Mr. Truong Ba Tuan said that the Ministry of Finance has reported to the Government regarding the adjustment of the family deduction level for taxpayers. In principle, the authority to adjust family deductions is according to the provisions of the current Personal Income Tax Law.

Since the Law on Personal Income Tax was passed, the Ministry of Finance has proactively reviewed and advised the National Assembly and the National Assembly Standing Committee to adjust the family deduction level in accordance with the actual situation.

Accordingly, from January 1, 2009, the deduction for taxpayers is 4 million VND/month (48 million VND/year); The deduction for each dependent person is 1.6 million VND/month. From July 1, 2013, the corresponding levels are 9 million VND/month (108 million VND/year) and 3.6 million VND/month. From the 2020 tax period, the corresponding levels are 11 million VND/month (132 million VND/year) and 4.4 million VND/month. Thus, the family deduction level has always been researched and adjusted to suit the practical situation

According to Mr. Truong Ba Tuan, the Personal Income Tax Law stipulates that the consumer price index fluctuates over 20% compared to the time the law takes effect or the time of the most recent adjustment of the family deduction level, then the Government will submit it to the National Assembly Standing Committee to adjust the level of family deductions.

Through monitoring the consumer price index from 2020 until now, the deduction level has not fluctuated to 20%, so in the coming time, the Ministry of Finance will continue to monitor the developments of this index to proactively propose according to regulations.

Regarding the overall amendment of the Personal Income Tax Law, Mr. Tuan said that the Ministry of Finance was assigned by the Government to review the overall tax laws. In 2024, we will focus on amending 3 Laws on Corporate Income Tax, VAT and Special Consumption. The Law on Personal Income Tax will be amended in 2025 according to the roadmap reported to the Government and reported to the National Assembly Standing Committee by the Government.

Along with considering the appropriate family deduction level, amending the Law on Personal Income will also amend the overall related content including personal income tax policy, taxable income, tax-exempt income, and related issues to the point of the family deduction level.