People have to tighten their belts to pay personal income tax.

Delegate Nguyen Thi Thuy

At the National Assembly's discussion session on the socio-economic situation and state budget on May 29, Deputy Chairwoman of the Judicial Committee Nguyen Thi Thuy (delegate from Bac Kan ) raised the above recommendation.

Outdated family deductions

According to the delegate, the family deduction according to the provisions of the Personal Income Tax Law for taxpayers is 11 million VND/person/month and each dependent is 4.4 million VND/person/month.

Many opinions say that such a deduction level is too outdated and needs to be considered and amended by the National Assembly soon, not waiting until 2026 to pass as proposed.

According to Ms. Thuy, the deduction of 4.4 million/person/month is no longer suitable for the current reality, especially in big cities, causing disadvantages for taxpayers. This level has been maintained since 2020, but in the past 5 years, many essential goods and services have increased in price, and some prices of essential goods and services have even increased faster than income increases.

Citing data from the General Statistics Office, delegates said that compared to 2020, education service prices increased by 17%, food prices by 27%, and especially gasoline prices increased by 105%.

Delegates informed that many voters shared that if a family has small children and hires a babysitter, the salary for the babysitter should not be less than 5 million VND/month, not including other expenses.

In case the family has children going to school, the cost of education accounts for the majority of the expenditure structure. In case the family has elderly parents as dependents, not only the cost of living but also the cost of medical care and medicine.

On that basis, delegate Thuy assessed that the current regulations on family deduction levels do not truly reflect family and personal spending levels nor do they reflect the reality of today's life.

"If we wait another two years to pass the proposed tax law, many people will have to tighten their belts but still have to pay personal income tax," said the delegate.

The Vice Chairman of the National Assembly's Judiciary Committee also pointed out the unreasonableness in the basket of goods used to calculate the CPI. According to the provisions of the Personal Income Tax Law, when the CPI index fluctuates by more than 20%, the Government submits to the National Assembly Standing Committee an adjustment to the family deduction level.

At the regular press conference last March, the Ministry of Finance did not propose adjusting family deductions because the CPI fluctuation was less than 20%.

Citing the comments of many experts and voters, he said that the tax law's criterion of CPI fluctuation of over 20%, which is based on price fluctuations of a basket of goods including 752 items, is unreasonable.

Meanwhile, essential goods that directly affect people's spending are only about 20 items, but it takes a long time to calculate the average price of over 752 items before applying the family deduction, even 6-7 years.

Not adjusting soon will affect the meaning of salary increase

According to delegates, this is too long a period of time to reflect spending fluctuations and cause disadvantages to the people.

Furthermore, delegate Thuy also said that the regulation on family deduction is not suitable for a country with a low average income, where the majority of people's income is spent on essential goods and services, up to 70%.

According to a survey by the National Economics University, in countries where people have a high income of about 100 million VND/month, the spending on essential goods and services accounts for 30-40%. Therefore, delegates believe that the current family deduction level directly affects people's spending on essential needs.

In the context of current fluctuations in wages, delegate Thuy assessed that if income tax and family deduction levels are not adjusted promptly, it will lead to inadequacies and cause anxiety for workers.

From July 1, salary reform will be implemented and the average salary of civil servants and public employees is expected to increase significantly, leading to an increase in taxable income. This will directly affect the significance of salary reform.

On that basis, delegate Thuy proposed that the Government should soon submit to the National Assembly amendments to the Personal Income Tax Law by the end of October this year and submit them to the National Assembly for approval in May 2025.

HA (according to Tuoi Tre)

Source: https://baohaiduong.vn/dai-bieu-quoc-hoi-nguoi-dan-phai-that-lung-buoc-bung-nop-thue-thu-nhap-ca-nhan-382989.html