Ministry of Finance proposes 2 options to increase family deduction level

At the regular Government press conference held on the afternoon of August 7, Deputy Minister of Finance Nguyen Duc Chi informed about the adjustment to increase the family deduction level in the draft Law on Personal Income Tax (amended) which is collecting opinions.

Deputy Minister of Finance Nguyen Duc Chi informed at the press conference. Photo: Dinh Hiep

Deputy Minister of Finance Nguyen Duc Chi informed that when studying this content, there were many opinions to propose different options as a basis for determining the family deduction level when calculating personal income tax.

The Deputy Minister reiterated the information on whether the family deduction should be calculated by region or not, including cities such as Hanoi , Ho Chi Minh City... with relatively expensive living costs. So should a higher family deduction be given to these regions or not?

Deputy Minister Nguyen Duc Chi emphasized that this is a plan that has been carefully researched by experts and professional staff of the Ministry of Finance.

Deputy Minister Nguyen Duc Chi emphasized: "Each option has its advantages and disadvantages", but the Ministry of Finance assessed that dividing the family deduction level by region has limitations and will be very difficult, even within a province or city, different areas have living expenses that require consideration of different and very different family deduction levels.

For example, the wards in the core areas of Ho Chi Minh City and Hanoi have very high living costs, but in more remote communes and areas in the countryside, the living costs and personal living expenses of each family are also different.

Therefore, the Ministry of Finance chose to propose to widely consult experts and agencies on 2 options, including: Option based on the adjustment level according to CPI and option 2 based on the growth rate of per capita income and GDP growth rate.

The Ministry of Finance has recorded the comments and found that the majority of opinions agree with option 2, which is that the family deduction level will be adjusted based on the growth rate of per capita income and the growth rate of per capita GDP.

“The Ministry of Finance is continuing to complete and determine accurate data based on the GDP growth rate from 2020 to present, to have the most specific plan. Thereby, the Ministry will report to the Government and the National Assembly Standing Committee according to the process of promulgating legal documents,” Deputy Minister Nguyen Duc Chi informed.

Source: https://hanoimoi.vn/bo-tai-chinh-de-xuat-2-phuong-an-ve-nang-muc-giam-tru-gia-canh-711782.html