Proposal to impose 35% personal income tax on taxable income over 100 million VND/month

VTV.vn - According to the draft Law on Personal Income Tax (amended), the tax schedule has 5 levels. The final tax rate is 35%, applied to taxable income over 100 million VND/month.

According to the draft Law on Personal Income Tax (amended), the draft law adjusts the progressive tax schedule applicable to resident individuals with income from salaries and wages by reducing the number of tax rates from 7 to 5 and widening the gap between the rates.

Specifically, the Government submitted to the National Assembly a plan to amend the Tax Schedule to 5 levels with the distance between levels increasing gradually to 10, 20, 30, 40 million VND. The 5 levels correspond to tax rates of 5%, 15%, 25%, 30%, 35%. The final tax rate is 35%, applied to taxable income over 100 million VND/month.

The progressive tax schedule is stipulated in the draft Law on Personal Income Tax (amended) submitted to the National Assembly on the morning of November 4.

According to calculations, along with the adjustment of the new family deduction level, this tax adjustment plan will reduce revenue by about 27,400 billion VND/year.

According to this plan, the majority of tax rates are reduced compared to the current level. However, based on the opinions of the reviewers, the opinions of the discussion groups and the halls of the National Assembly Deputies, the Government will conduct a comprehensive study and make additional and thorough assessments to ensure reasonableness, and report to the National Assembly for consideration.

Personal income tax on income from salaries and wages of resident individuals is determined by multiplying taxable income, regardless of where the income is paid, by the tax rate in the progressive tax table.

Taxable income for income from salaries and wages is the total taxable income that the taxpayer receives during the tax period, minus (-) social insurance, health insurance, unemployment insurance, professional liability insurance contributions for certain industries and occupations that must participate in compulsory insurance, contributions to supplementary retirement insurance under the Law on Social Insurance, purchase of voluntary retirement insurance, life insurance not exceeding the level prescribed by the Government and deductions.

According to the draft Law, income from salaries and wages includes: Salaries, wages and amounts of salary or wage nature; Remuneration, benefits in cash or non-cash in any form; Allowances, subsidies, other income.

Commenting on this content, the National Assembly's Economic and Financial Committee said that there were many concerns about the reasonableness of the plan to adjust income thresholds and corresponding tax rates in the tax table because some taxable incomes of the draft Law create a greater personal income tax burden for taxpayers while most other taxable incomes create lower tax obligations than the current Law.

“This does not ensure fairness for taxpayers among income groups,” the Economic and Financial Committee stated.

Proposal to add specific family deduction levels

Also related to the issue of personal income tax payment, the Economic and Financial Committee emphasized that the regulation on family deduction is an important content and one of the bases for taxpayers to determine their tax obligations, therefore, receiving special attention from the people and society.

Chairman of the National Assembly's Economic and Financial Committee Phan Van Mai presented the report on examining the draft Law on Personal Income Tax (amended) on the morning of November 4.

According to this Committee, the actual implementation in recent times and the experience of other countries show that the family deduction level is not actually adjusted too frequently or continuously and is not an urgent matter that needs to be regulated by the Government to ensure flexibility and timeliness.

Therefore, the Economic and Financial Committee proposes to continue to specify the family deduction level in the draft Law. At the same time, the Government is assigned to submit to the National Assembly Standing Committee for consideration and adjustment of the family deduction level if necessary, in accordance with actual needs as expressed in the current Law on Personal Income Tax.

According to the draft Law submitted to the National Assembly, based on fluctuations in prices and income, the Government will prescribe the family deduction level in this clause in accordance with the socio-economic situation in each period.

Previously, on October 17, the National Assembly Standing Committee passed a Resolution on adjusting the personal income tax deduction level. According to the Resolution, the deduction level for the taxpayer himself/herself was increased to 15.5 million VND/month, and for each dependent to 6.2 million VND/month.

With this new family deduction, individuals do not have to pay tax with an income of 17 million VND/month (if no dependents) or 24 million VND/month (if 01 dependent) or 31 million VND/month (if 02 dependents). This resolution will apply from the 2026 tax period.

Source: https://vtv.vn/de-xuat-ap-thue-thu-nhap-ca-nhan-35-voi-thu-nhap-tinh-thue-tren-100-trieu-dong-thang-100251104160003251.htm