In recent times, public opinion has suggested that the reduction of family circumstances should be based on the regional minimum wage so that each year when the regional minimum wage is increased, the deduction will also automatically increase, instead of being fixed at a fixed rate. as it currently causes workers to suffer double losses.
In addition, it is also suggested that the family deduction for dependents should be increased to 70% of the deduction for employees because the current level of 4.4 million VND/month is too outdated.
Responding to this issue, the Ministry of Finance said that according to the provisions of the current Personal Income Tax Law, individuals are entitled to deductions for social insurance, health insurance, unemployment insurance, minus the deduction. family circumstances, charitable and humanitarian contributions, allowances and allowances are deducted (if any)… the rest is the income used as a basis for calculating personal income tax.
For individuals who are employees affected by the COVID-19 epidemic, if they lose their jobs, have no income or have income that is not yet taxable, they do not have to pay tax. Unexpected hardship allowances, severance allowances, job loss allowances… are also not included in the individual’s taxable income.
Also according to the Ministry of Finance, on June 2, 2020, the National Assembly Standing Committee approved a resolution on adjusting the reduction of family circumstances of personal income tax. Accordingly, the adjustment increases the deduction for taxpayers from 9 million VND/month to 11 million VND/month, for each dependent from 3.6 million VND/month to 4.4 million VND/month and applies right from the tax year 2020.
According to the Ministry of Finance, people who earn income from salaries and wages of 17 million VND/month (if there is 1 dependent) or 22 million VND/month (if there are 2 dependents) do not have to pay personal income tax. core
With the adjustment to increase the deduction for the taxpayer himself from 9 million VND to 11 million VND/month and for each dependent from 3.6 million VND to 4.4 million VND/month, the person with income from salary and wages of 17 million VND/month (if there is 1 dependent) or 22 million VND/month (if there are 2 dependents) are not subject to personal income tax.
“In case an individual has an income greater than the above levels (17 million VND/month, 22 million VND/month), the tax payable is also very small compared to the individual’s income”, the Ministry of Finance said.
The Ministry of Finance also gives an example, for a dependent or individual with an income of 40 million VND/month, the payable personal income tax amount is 6.61%/income; income of 60 million dong/month, the tax payable is 11.86%/income; income of 80 million VND/month, the tax payable is 15.74%/income; If income is 100 million VND/month, the tax payable is 18.66%/income.
For individuals with a high income of over 100 million VND, the new tax payable is at a rate higher than 20%/income.
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