At the press conference announcing the results of the 8th session of the 15th National Assembly , Mr. Vu Tuan Anh, Standing Member of the Finance and Budget Committee of the National Assembly, explained the reason for only reducing VAT by 2% until the end of June 2025.
2 reasons why you shouldn't prolong the time
This afternoon (November 30th), during the press conference announcing the results of the 8th session of the 15th National Assembly, a reporter from Giao Thong Newspaper asked about the National Assembly's decision to reduce value-added tax (VAT) for the first six months of 2025. This decision was eagerly awaited by many businesses, as it provided them with additional resources for recovery and more sustainable development.
However, why not extend the deadline to the entire year of 2025 to truly provide effective support to businesses, both psychologically and in terms of resources?
"In addition, the reduction of income tax for journalists has received feedback from some delegates suggesting that it needs to be further reduced to facilitate the operation of media organizations. How will the drafting and reviewing agencies respond to this?", a reporter from Giao Thong Newspaper asked.
Mr. Vu Tuan Anh, Standing Member of the Finance and Budget Committee of the National Assembly.
Responding to this issue, Mr. Vu Tuan Anh, Standing Member of the National Assembly's Finance and Budget Committee, stated that the Government has repeatedly proposed a 2% reduction in VAT over the past period.
"This time, the tax reduction will only be implemented for 6 months, because it relates to the local budget balance. When the Government submits the proposal, the budget estimate has already been approved by the National Assembly, so reducing taxes for the whole year would affect the balance," Mr. Tuan Anh said.
The second reason given by Mr. Vu Tuan Anh is that the Value Added Tax Law (amended), recently passed by the National Assembly, will take effect from July 1, 2025.
"Therefore, a 2% reduction until the end of June 2025 is appropriate. Once the tax reduction resolution is completed, the regulations of the newly passed law will apply," said Mr. Vu Tuan Anh.
Regarding the reduction of income tax for journalists, Mr. Tuan Anh said that recently, with the amendment of the Value Added Tax Law, the Government is closely following the tax reform strategy, reducing the number of tax-exempt subjects, as well as the 5% tax rate, in order to move towards implementing a single tax rate.
Recently, the government has been evaluating many types of goods and services to determine how to adjust the categories exempt from tax, as well as reduce the 5% tax rate.
"Some National Assembly deputies have suggested reducing tax rates for the cultural sector, including the press. However, we have also socialized many activities related to the cultural and journalistic fields."
Upon review, it was found that implementing the tax reform strategy would eventually result in a single tax rate being applied uniformly, eliminating tax incentives.
International practice, as well as international organizations, have repeatedly advised us that tax incentives do not guarantee fairness. Therefore, support should not be provided through taxes," Mr. Tuan Anh said.
The government has not yet submitted to the National Assembly a proposal to amend the personal allowance deduction.
At the press conference, the media also reflected on the much-discussed issue of personal deductions, and the Ministry of Finance had already sought public opinion. However, it is expected to be approved in 2026 and implemented in 2027. Meanwhile, the current personal deduction level is outdated and negatively impacts people's lives.
A panoramic view of the press conference.
In response to this question, Mr. Vu Tuan Anh stated that many delegates had expressed opinions on amending the personal allowance deduction. However, the Government has not yet submitted this matter to the National Assembly Standing Committee.
In fact, compared to the previous adjustment, the personal allowance deduction has changed significantly. During the process of working with the drafting agency, the National Assembly's agencies have provided input for further research and changes.
However, the Ministry of Finance has recently focused on addressing areas with immediate obstacles. The amendment to the Value Added Tax Law has adjusted the VAT threshold from 100 million VND to 200 million VND. The amendment to the Personal Income Tax Law will also be implemented to lower the tax threshold for households and individuals engaged in production and business activities.
"Regarding personal deductions, adjustments to the regulations will be presented when the law is amended. However, according to the authority granted, the Government has not yet submitted the adjustments to the Standing Committee of the National Assembly for consideration," said Mr. Vu Tuan Anh.
The Ministry of Finance has just released a draft submission to the Government proposing the development of a new Personal Income Tax Law. The draft proposes changes to the personal allowance and taxable revenue for individuals and business households before calculating personal income tax.
Regarding personal deductions, the draft proposal acknowledges that the current rate, applied from 2020 to the present, needs to be reviewed and reassessed in order to propose amendments and additions that are appropriate to the new conditions.
Currently, the personal allowance for individual income taxpayers is 11 million VND/month, and for dependents it is 4.4 million VND/month.
However, besides the excessively low deductions, the current tax schedule is also considered unreasonable, with too many brackets and too narrow gaps between them, easily leading to tax bracket jumps.
Therefore, the Ministry of Finance proposes reducing the number of tax brackets from seven (currently 5%, 10%, 15%, 20%, 25%, 30%, and 35%) to a more appropriate level; along with considering widening the income gap within the tax brackets, ensuring a higher level of taxation for those with higher incomes in the tax brackets.
Source: https://www.baogiaothong.vn/vi-sao-giam-2-thue-vat-chi-ap-dung-den-het-thang-6-2025-192241130180234169.htm
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