From 2026, the family deduction for personal income tax calculation will increase by more than 40%

On the morning of October 17, the National Assembly Standing Committee passed a Resolution on adjusting the family deduction level of personal income tax.

Accordingly, the Standing Committee of the National Assembly decided to adjust the family deduction level of personal income tax.

The Resolution of the National Assembly Standing Committee clearly states that the deduction for taxpayers is 15.5 million VND/month (186 million VND/year) and the deduction for each dependent is 6.2 million VND/month.

From 2026, the family deduction for personal income tax calculation will increase by more than 40% - 1

National Assembly Standing Committee meeting on the morning of October 17 (Photo: Hong Phong).

This Resolution takes effect from the date of signing and applies from the 2026 tax period.

The Government 's report said that according to calculations, by the end of 2025, the consumer price index (CPI) had fluctuated by more than 20% compared to the time of the most recent adjustment of the family deduction level (2020) at 21.24%. Therefore, the adjustment of the family deduction level needs to be consistent with price fluctuations.

The Government proposed two options, but the majority of opinions supported the second option, which is to adjust the family deduction level according to the growth rate of average income per capita and the growth rate of average GDP per capita.

Accordingly, the deduction for taxpayers will be increased from 11 million VND/month to about 15.5 million VND/month (an increase of about 40.9% compared to the current level).

The deduction for each dependent increases from VND 4.4 million/month to about VND 6.2 million/month (an increase of about 40.9% compared to the current level).

The Government calculates that if this plan is implemented, the State budget is expected to decrease by about 21,000 billion VND/year compared to the revenue level and number of taxpayers according to current regulations.

The basis for this plan is based on data from the General Statistics Office, the Government said that the fluctuation in per capita income and per capita GDP from 2020 to present is about 40-42%. Therefore, based on the growth rate of per capita income and per capita GDP in 2025 compared to 2020, the family deduction level is adjusted to increase as above.

From 2026, the family deduction for personal income tax calculation will increase by more than 40% - 2

Deputy Minister of Finance Nguyen Duc Chi (Photo: Hong Phong).

According to the Government, adjusting the family deduction level for taxpayers will contribute to reducing taxpayers' obligations in the context of increasing prices and inflation compared to 2020.

The Government believes that adjusting the family deduction level according to the growth rate of GDP per capita and average income per capita also contributes to reducing tax obligations for taxpayers at a higher level than adjusting according to the CPI index, people enjoy the fruits of the country's socio-economic development and social life is improved.

With the expected reduction, lower income earners will benefit more, according to the Government's assessment.

Although the increase in the family deduction level will have an impact on reducing the State budget revenue from personal income tax in the first few years, according to the Government, when the family deduction level is higher, it means less tax to be paid, and people's disposable income will increase.

The Government believes that this will contribute to stimulating increased household spending and social consumption, contributing to the development of production and business, thereby indirectly increasing budget revenue from other sources in the medium and long term.

Examining this content, the Standing Committee of the Economic and Financial Committee agreed on the need to adjust the personal income tax deduction level for taxpayers and dependents to suit the socio-economic situation and price fluctuations.

The auditing agency believes that adjusting the family deduction level also contributes to reasonably and fairly mobilizing income, creating motivation for taxpayers to save and consume, contributing to promoting economic growth.

Source: https://dantri.com.vn/thoi-su/tu-2026-muc-giam-tru-gia-canh-tinh-thue-thu-nhap-ca-nhan-tang-hon-40-20251017103336065.htm