How much tax reduction do salaried employees receive?

Discounts ranging from a few hundred thousand to a few million dong.

The new Personal Income Tax Law will take effect on July 1, 2026. However, regulations related to income from business activities and salaries/wages of resident individuals will apply from the 2026 tax year. This means that from the beginning of 2026, personal income tax for salaried employees will be calculated according to the new regulations. Specifically, the progressive tax rate schedule in the law has been simplified from the current 7 brackets to 5. In a previous explanatory report, Minister of Finance Nguyen Van Thang stated that this new personal income tax schedule helps individuals reduce their tax liability. This also addresses the current situation of sharply increasing tax rates between brackets.

At the same time, the personal allowance for taxpayers has been increased to VND 15.5 million/month (previously VND 11 million/month), and to VND 6.2 million/month for each dependent (previously VND 4.4 million/month). In addition to the personal allowance, taxpayers are also entitled to deductions for mandatory insurance contributions, charitable and humanitarian contributions, and other deductions. According to regulations, the mandatory insurance contributions currently paid by employees are 10.5% of their monthly salary subject to mandatory social insurance (maximum 20 times the base salary, equivalent to VND 46.8 million).

Người làm công ăn lương được giảm thuế bao nhiêu?- Ảnh 1. — *Salaried employees will receive a reduction in personal income tax starting in 2026.*

The law also stipulates that taxable income from salaries and wages is the total taxable income received minus the expenses specified above. Therefore, an individual earning 17 million VND/month, after deducting 10.5% insurance and a 15.5 million VND allowance, will not have to pay personal income tax from next year. This means the individual will have reduced their tax liability by 210,000 VND/month compared to the current situation. Similarly, an individual earning 24 million VND/month with one dependent will also not have to pay personal income tax because the allowance and mandatory insurance contributions total 24.1 million VND. This means the individual will have reduced their tax liability by 610,000 VND/month compared to the current regulations.

Người làm công ăn lương được giảm thuế bao nhiêu?- Ảnh 2. — *Progressive tariff system*

When an employee earns 30 million VND per month and has one dependent, after deductions, their remaining taxable income is 5.9 million VND. This individual will pay personal income tax at bracket 1 with a tax rate of 5% instead of the current bracket 3 with a tax rate of 15% (bracket 3 applies to taxable income between 10 million and 18 million VND per month). This corresponds to a tax reduction of 295,000 VND per month, compared to the current amount of 968,000 VND.

Assuming an individual earns 50 million VND per month and has one dependent, after deductions, their remaining income would be approximately 23.4 million VND. This individual would fall into tax bracket 2 with a 10% tax rate, instead of the current 20% tax rate at bracket 4. This would result in a tax reduction of approximately 1.84 million VND per month, a decrease of 2.45 million VND compared to the current amount of nearly 4.3 million VND. Similarly, an individual earning 100 million VND per month and having one dependent would have a remaining taxable income of approximately 73.39 million VND after deductions. This individual would pay tax at bracket 4 with a 30% tax rate, resulting in a tax reduction of over 12.5 million VND per month, a decrease of 5.54 million VND compared to the current amount of over 18 million VND.

If an individual earns approximately 130 million VND per month from salaries and wages, after deductions they will have to pay the highest tax rate, bracket 5, at 35%. This means the individual would pay over 21.68 million VND in taxes, a reduction of 6.85 million VND compared to the current tax amount of over 28.5 million VND…

Waiting for regulations on deductible expenses for healthcare and education.

In addition to the personal income tax deduction, the new Personal Income Tax Law also stipulates that salaried employees will be entitled to deductions for expenses related to healthcare , education, and training for themselves and their dependents, at levels determined by the Government. These expenses must meet the requirements for invoices and supporting documents as prescribed by law and cannot be paid from other sources. Therefore, once the Government specifies the details of these healthcare and education expenses, the personal income tax for salaried employees will be further reduced from 2026 onwards.

Người làm công ăn lương được giảm thuế bao nhiêu?- Ảnh 3. — *Starting in 2026, all salaried employees will receive a reduction in personal income tax.*

Previously, when commenting on the draft amendments to the Personal Income Tax Law, many experts suggested allowing taxpayers to deduct these essential expenses. Lawyer Tran Xoa, Director of Minh Dang Quang Law Firm, suggested that the Government could set a maximum amount for deductible education and training fees, such as 20 million VND per person per year. Similarly, medical expenses are also a burden for taxpayers. In particular, serious illnesses always require expensive specialized medications and advanced treatment techniques that are not fully covered by health insurance. Therefore, the Government could set a maximum amount for deductible medical expenses per year, possibly up to 20% of taxable income.

Meanwhile, Dr. Do Thien Anh Tuan from Fulbright University cited several countries that allow deductions for tuition fees, voluntary insurance, or "family" expenses such as pregnant women, childbirth, and caring for the elderly and sick. For example, Thailand allows deductions of up to 25,000 baht/year for health insurance (approximately 20 million VND/year); up to 100,000 baht/year for private education for children (approximately 79.7 million VND/year); and up to 30,000 baht/person for parent care (over 60 years old)... Similarly, China allows deductions for education and childcare up to 2,000 yuan/month/child (approximately 7 million VND/month). In addition, large medical expenses are also deductible if they exceed the prescribed threshold... Therefore, the Government could set a ceiling for these two expenses, for example, a maximum of 30% of taxable income, to allow people to deduct essential expenses while ensuring the management of the risk of budget revenue loss.

Cases eligible for tax exemption or reduction.

- Taxpayers facing difficulties due to natural disasters, epidemics, fires, accidents, or serious illnesses affecting their ability to pay taxes may receive a tax reduction commensurate with the extent of the damage, but not exceeding the amount of tax payable.

- Exemption from personal income tax for a period of 5 years for income from salaries and wages of individuals who are high-quality digital technology industry personnel.

- Exemption from personal income tax for a period of 5 years for income from salaries and wages of individuals who are high-tech personnel engaged in research and development of high-tech or strategic technologies belonging to the List of High Technologies prioritized for investment and development or the List of strategic technologies and strategic technology products as prescribed by law on high technology.

- Exemption from personal income tax on the transfer of open-ended fund certificates established in accordance with regulations and held for 2 years or more from the date of purchase.

- A 50% reduction in personal income tax for dividends received by individual investors from securities investment funds and real estate investment funds, for a period specified by the Government.

Source: Thanh Nien (Youth)

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