At a regular press conference on July 2, Truong Ba Tuan, an official of the MoF, stated that the MoF is now working with relevant ministries and localities to draft a new Personal Income Tax Law to replace the current one.

He said that the MoF has submitted a report to the Government after conducting a comprehensive review of the current law, identifying shortcomings, and examining international best practices.

He revealed that the proposed amendments would address six major areas, including redefining taxable income and tax calculation methods for each income group to reflect economic and labour market changes, and expanding tax-exempt income categories, taking into account high-quality human resource development, the high-tech sector, the digital economy, the green economy, and innovation.

Notably, the MoF has adjusted family tax deductions, based on changes in the consumer price index, living standards, and average income. The Ministry is also considering new deductions related to education, health care, and social security.

The 2008 Personal Income Tax Law stipulates that the personal deduction for the tax payer is VND11 million per month and the deduction for each dependent is VND4.4 million per month. It also regulates that in cases where the Consumer Price Index (CPI) fluctuates by more than 20% compared to the time the law took effect, family tax deduction adjustments will be considered.

According to the Ministry of Finance, the CPI has increased by over 15% from 2020 to the end of 2024, and it was not the right time then to consider adjustments.

However, experts and voters in various localities have repeatedly called these deductions outdated, proposing increases to VND15–18 million to ease the burden on salaried workers.

In Vietnam, the personal income tax (PIT) is the third largest tax revenue source, after the value added tax and corporate income tax. Last year, PIT revenue reached VND189 trillion, up 20% year-on-year, accounting for 9.3% of total revenue and representing a significant rise from 5.3% in 2011. In 2024, the state budget revenue exceeded VND2 quadrillion for the first time.

Ministry yet to consider adjusting family tax deduction rate now

VOV.VN - The Ministry of Finance has said it is not the right time to adjust the family tax deduction rate, reasoning that the Consumer Price Index has not fluctuated significantly.