Need to consider adding a joint personal income tax declaration mechanism for married couples

“It is time to consider adding a joint tax declaration mechanism for married couples, because the current separate tax declaration system invisibly creates inequality in tax policy between family models…”.

Director of Hanoi Tax Consulting Company Le Yen emphasized when talking with reporters of Hanoi Moi Newspaper about the draft Law on Personal Income Tax (replacement).

-The draft Law on Personal Income Tax (replacement) adds provisions allowing deductions for certain expenses such as healthcare, education and training of taxpayers and dependents. What is your assessment of this provision?

-I consider this a positive step forward. This policy not only demonstrates humanity but also contributes to more reasonable tax regulation, especially in the context of increasing living costs.

Expenses for health care and education are basic needs, often mandatory for every family. Allowing deductions for these expenses helps people with average to high incomes reduce their financial burden, while also reflecting the true nature of personal income tax, which is a tax on the portion of income actually used after covering essential needs.

Ms. Le Yen, Director of Hanoi Tax Consulting Company. Photo: NVCC

- So, in your opinion, how should the deduction policy for medical expenses be designed to be reasonable?

- For this policy to be feasible and transparent, it needs to be specifically designed. In my opinion, it is necessary to clearly define the applicable subjects (taxpayers and legal dependents), the types of valid expenses (medical examination and treatment, medicine, childbirth, treatment of chronic diseases...). The reasonable deduction level is annual or as a percentage of income, and at the same time requires complete documents such as financial invoices, prescriptions, medical records.

I think it is possible to consider giving higher priority to deductions for the elderly, people with serious illnesses or people with low incomes.

However, expenses that are covered by health insurance or commercial insurance should not be counted as deductible expenses.

- When the above items are included in the deductible expenses, what solutions are needed so that the policy is implemented correctly for the right subjects, avoiding exploitation for personal gain, madam?

- To ensure that policies are on target and not exploited, there needs to be a synchronous solution such as checking the origin of costs through valid invoices and documents, and moving towards connecting data between tax authorities and health, education, banking, and insurance units.

At the same time, reasonable deduction limits should be set, post-audits should be strengthened and clear instructions should be issued so that both people and businesses can easily apply the regulations correctly.

- What are your suggestions for the draft Law on Personal Income Tax (replacement)?

- I think it is time to consider adding a joint tax filing mechanism for married couples. Currently, each individual files their own tax return, leading to a situation where the only person with income in the family bears the entire tax liability, while the other person, even though he or she has no income, is still contributing to the family through roles such as caring for young children, the elderly, or performing housework.

This inadvertently creates inequality in tax policy among family models, especially young families, families with members on long-term maternity leave or women temporarily leaving the labor market to take care of family, young children...

If joint tax declaration is allowed, the total income of both spouses will be added together and allocated reasonably when calculating taxes, thereby reducing the amount of tax payable by applying a progressive tax schedule at a lighter rate, while more accurately reflecting the actual financial capacity of the entire household, not just the individual.

This ensures fairness between single-income and dual-income families, encourages stability in labor-family relations, and creates a more favorable legal environment for social security policies.

In many countries, this mechanism does not significantly reduce total tax revenue, but mainly adjusts the way taxes are calculated on the same total income to ensure fairness and reasonableness.

For Vietnam, if applicable, it is necessary to carefully study the selection conditions (separate or joint tax declaration options), appropriate deduction levels, and simple calculation methods to facilitate implementation.

Adding this mechanism will be an important step forward in designing tax policies that are linked to real life, suitable for the context of many families with uneven income structures; at the same time, it demonstrates the understanding and companionship of the tax system towards the people.

This revision of the personal income tax policy is an opportunity for Vietnam to build a more modern, fair and practical tax system. Along with expanding deductions, it is necessary to consider household characteristics to accurately reflect the ability to pay and create positive incentives for taxpayers.

Thank you very much!

Source: https://hanoimoi.vn/can-xem-xet-bo-sung-co-che-khai-thue-thu-nhap-ca-nhan-chung-cho-vo-chong-711773.html