On the afternoon of May 29, during the National Assembly's socio-economic discussion session, the issue of personal income tax continued to receive attention from National Assembly deputies.

Delegate Dang Bich Ngoc (Hoa Binh) agreed with the statement of Delegate Nguyen Thi Thuy ( Bac Kan ) this morning about the family deduction for each dependent of 4.4 million VND/month as the basis for calculating personal income tax.

According to the delegate, it is necessary to adjust the family deduction for the taxpayer himself, which is currently only at 132 million VND/year, equivalent to 11 million VND/month; the progressive tax schedule also needs to be studied and adjusted to increase the progressive tax rates for each income (currently, taxable income up to 60 million/year is subject to a tax rate of 5%).

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Delegate Dang Bich Ngoc. Photo: National Assembly

At the same time, the application of tax rates and tax schedules from 2007 to present is no longer suitable, because the scale of the economy and GDP growth have changed.

In 2007, the economic scale was about 77.4 billion USD, the average income per capita was 13.5 million VND/person/year (840 USD/person/year), the economy was low-income. But in 2023, the economic scale increased to 430 billion USD, the average income per capita was nearly 101.9 million VND/person/year. This level is 7.5 times higher than in 2007. Personal income tax settlement in 2009 was 14,318 billion VND, in 2022 it was 162,790 billion VND, accounting for 11.2% of total domestic revenue. 11.4 times higher than the settlement in 2009.

Personal income tax is a direct tax, calculated directly on the income of employees...

Ms. Ngoc suggested that the Government should soon study and comprehensively amend the Personal Income Tax Law, in the direction of only calculating tax on high-income earners. According to her, this is suitable for the scale of economic development and does not affect low-income earners.

Explaining later, Finance Minister Ho Duc Phoc said that the Personal Income Tax Law came into effect in 2009, at that time the family deduction was about 4 million VND, the dependent deduction was 1.6 million VND/month.

By 2013, the amended Law raised the family deduction to 9 million VND/month, or 108 million VND/year; dependents to 3.6 million VND/month and added a condition that when the CPI fluctuates by 20%, the National Assembly Standing Committee must adjust the family deduction.

By 2020, the family deduction was raised again, to 11 million VND/month and dependents to 4.4 million VND/month, applied since then.

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Finance Minister Ho Duc Phoc explained this afternoon. Photo: National Assembly

Currently, for those with 1 dependent, income from 17 million or more must pay income tax. Those with 2 dependents must pay income tax over 22 million. These levels do not include compulsory insurance.

The Minister of Finance said that this agency has not yet submitted to competent authorities to adjust the Personal Income Tax Law, because compared to data from the General Statistics Office, the deduction for taxpayers of 11 million VND/month is 2.2 times higher than the average income (4.96 million VND/person/month), while this rate in other countries is less than 1 time.

In addition, the average CPI from 2020 to present is 11.74%, lower than the tax adjustment condition (CPI must be above 20%). "The Ministry of Finance is acting in accordance with the law," he said.

According to Mr. Ho Duc Phoc, the National Assembly Standing Committee has included the Personal Income Tax Law in the October 2025 law-making program, to be passed at the May 2026 session. If the National Assembly Standing Committee decides to do it this year to pass it in May 2026, the Ministry of Finance will comply, seek opinions from National Assembly deputies and the people to issue appropriate regulations.

Salary increase without income tax adjustment, family deduction will cause concern

Salary increase without income tax adjustment, family deduction will cause concern

Wages increase but personal income tax and family deductions are not adjusted promptly, causing concern for workers because when wages increase, taxable income also increases.