Comprehensive amendment of Vietnamese Personal Income Tax Law

Today, November 25, the Ministry of Finance officially solicited public comments on the amendment of the shortcomings of the Personal Income Tax Law. The comprehensive amendment is to replace the current Personal Income Tax Law. According to information from the Ministry of Finance, this amendment is a comprehensive amendment of the Personal Income Tax Law.

1. The family deduction level, tax base… are outdated

In the draft proposal to develop a project on the Personal Income Tax Law (replacement), the Ministry of Finance said that the implementation of the Personal Income Tax Law has demonstrated and promoted its role as an important tax in the current tax policy system of Vietnam.

However, the Ministry of Finance also acknowledged that the current Personal Income Tax Law has also given rise to a number of limitations and shortcomings that need to be studied for review and amendment to suit reality, meet the requirements for reforming personal income tax, and ensure transparency.


Voters recommend early amendment of the Personal Income Tax Law

The proposed contents that need to be considered for amendment include regulations related to taxable income; tax-exempt income; tax basis and method for determining the amount of tax payable for certain income items; personal income tax rate schedule for income from salaries and wages; family deductions for taxpayers and dependents.

In an exchange with Tuoi Tre Online, tax experts and personal income taxpayers all suggested comprehensively amending the Personal Income Tax Law. Because the current regulations are outdated and backward compared to the actual situation, causing taxpayers to be disadvantaged.

According to Mr. Nguyen Ngoc Tu – a tax expert, the current family deduction is outdated, such as a deduction of 4.4 million VND/month for dependents who are students. This level does not guarantee to cover the most essential expenses such as food, accommodation, transportation, and education… for a child in the city.


Need to comprehensively amend the Personal Income Tax Law

Or the regulation that to be eligible for family deductions, dependents must have an average monthly income of no more than 1 million VND. This regulation has been in place for more than ten years while prices have fluctuated greatly. On the other hand, the highest tax rate for personal income tax of up to 35% is too high, while the corporate income tax rate is 20%.

2.The Law on Personal Income Tax (replacement) will be passed by the National Assembly in May 2026

In an official dispatch recently sent to ministries, branches and localities to seek comments on the draft Law on Personal Income Tax (replacement), the Ministry of Finance said that the Government has reported to the National Assembly Standing Committee the results of research, review and proposal to develop the Law on Personal Income Tax (replacement).

At the same time, the Government has proposed to include the Law on Personal Income Tax (replacement) in the 2025 Law and Ordinance Development Program, submit it to the National Assembly for comments at the 10th session (October 2025), and approve it at the 11th session (May 2026).

The Ministry of Finance requests that agencies, based on their functions and tasks, research and give their opinions on the proposal to develop the Law on Personal Income Tax (replacement). Contributed comments should be sent to the Ministry of Finance before December 20 for synthesis and reporting to the Government.

3. Reduce taxes to share with taxpayers

The regulations on family deductions are outdated in the context of ‘price storms’, making the lives of wage earners increasingly difficult. In particular, since the beginning of the year, prices of goods and essential services from bunches of vegetables, kilos of meat, cooking oil, gasoline, etc. have all increased sharply, making the lives of wage earners extremely difficult. The support from the economic recovery program after 2 years of the COVID-19 outbreak has not yet reached the majority and is only short-term support.

According to the recommendations of many experts, at this time, reducing personal income tax to share and encourage salaried workers is extremely necessary and has a humane meaning. It also ensures fairness between organizations and individuals, and cannot be treated unfairly.

Because in the past two years, the National Assembly and the Government have had many policies to support businesses, from reducing 30% of corporate income tax to land rent, tax deferral, and currently businesses continue to receive 2% interest rate support from the Government. Meanwhile, there has been no support for personal income tax.

The above content is our answer and advice for customers of S4B Vietnam regarding the Comprehensive amendment of the Personal Income Tax Law. If you have any questions about this matter, please send them to Email: service@s4b.com.vn

>>>Read more: The Role of Trade Union contribution in Enterprises

S4B Vietnam

  • Address: Unit 602A, Tower A, Handi Resco Office Building. 521 Kim Ma Street, Ba Dinh District, Hanoi
  • Tel: + 84 24 3974 4181
  • Email: service@s4b.com.vn

——————————————–
We Will Show You The Way To Success!