The Ministry of Finance still wants to impose the highest personal income tax of 35%.

In the latest draft of the Law on Personal Income Tax (amended), the Ministry of Finance submitted to the Government a minimum tax rate of 5% corresponding to taxable income in a month of 10 million VND (after deducting family circumstances and other taxable expenses). The maximum tax rate is 35%, for taxable income over 100 million VND. The progressive tax rate is reduced to 5 levels.

Proposed tax rate adjustment by the Ministry of Finance:

Tax rates	Current	Plan submitted to the Government
	Taxable income (million VND/month)	Tax rate (%)	Taxable income (million VND/month)	Tax rate (%)
1	to 5	5	to 10	5
2	> 5-10	10	> 10-30	15
3	> 10-18	15	> 30-60	25
4	> 18-32	20	> 60-100	30
5	> 32-52	25	over 100	35
6	> 52-80	30
7	over 80	35

Previously, some experts said that a maximum personal income tax rate of 20-25% would be more suitable for Vietnam when average income is not high and the economy needs to accumulate and invest.

According to a survey conducted in August, about 68% of nearly 5,000 respondents chose the highest personal income tax rate of 20-25%. Only 5% agreed to pay the highest tax rate of 35%, while 11% chose the maximum rate of 30%.

However, the Ministry of Finance cited international experience showing that some countries still maintain the highest tax rate of 35% (Thailand, Indonesia, Philippines), even 45% (China, South Korea, Japan, India).

The agency also believes that adjusting the tax rate according to the draft plan, along with increasing the family deduction level and adding other deductions (health, education) will reduce the tax adjustment level - the tax payment rate on total income. This will support taxpayers, especially individuals with average and low incomes, to switch to not having to pay personal income tax. Meanwhile, the tax adjustment level for people with higher incomes will also decrease compared to the current level.

For example, an individual has one dependent, income from salary and wages of 20 million VND per month, the current tax rate is 125,000 VND per month. After implementing family deductions and tax schedule according to the proposed plan, no tax will be payable.

For those earning VND25 million a month, the tax payable is reduced from VND448,000 to VND34,000 a month, a reduction of 92%. Similarly, those earning VND30 million have their tax payable reduced by 73% for the month.

According to the 2024 population living standards survey report of the General Statistics Office, Vietnam's average income per capita is 5.4 million VND and the group of households with the highest income - corresponding to the richest 20% of the population - has an average income of 11.8 million VND per person per month.

According to the Ministry of Finance, tax regulation is also aimed at the upper middle income group. Specifically, the 5% tax rate at level 1 applies to taxable income of 0-10 million VND, equivalent to income from salary and wages of an individual with 1 dependent of 20-35 million VND. The tax rate at level 2 applies to taxable income of 10-30 million VND, equivalent to income of 35-56 million VND...

Regarding budget revenue, the Ministry of Finance calculated the revenue reduction according to the plan submitted to the Government at 8,740 billion VND.

The draft Law on Personal Income Tax (amended) is expected to be submitted to the National Assembly for consideration and approval at the October session.

PV-VNE

Source: https://baohaiphong.vn/bo-tai-chinh-van-muon-danh-thue-thu-nhap-ca-nhan-cao-nhat-35-519981.html