ANTD.VN - In the draft proposal to build a project on personal income tax (replacement) that is being published by the Ministry of Finance for public consultation, a notable proposal is to expand the scope of tax on income from inheritance and gifts.
Additional inheritance and taxable gifts
The Ministry of Finance said that in Clause 9, Clause 10, Article 3, Article 18 of the current Personal Income Tax Law only stipulates the collection of personal income tax (PIT) on inherited assets, gifts that are securities, capital in economic organizations, business establishments, real estate and other assets that must be registered for ownership or registered for use, while not collecting tax on a type of inherited assets that many countries in the world have applied.
Through reviewing international experience, the Ministry of Finance found that many countries tax inheritance and gifts based on value, including both assets and cash. In Thailand, assets subject to inheritance tax include real estate, securities as prescribed by law, bank deposit accounts or other similar types of money, registered vehicles and financial assets.
Korea, Japan... stipulate personal income tax on inheritance including all inherited assets.
Accordingly, to ensure comprehensiveness and fairness in implementing tax obligations for the same type of income, in accordance with current civil laws on inheritance and forms of inheritance, the Ministry of Finance believes that it is necessary to review, study, amend and supplement regulations on income from inheritance and gifts in the Law on Personal Income Tax to suit reality.
Researching and amending regulations on income from inheritance and gifts will contribute to expanding the tax base in the direction determined in many documents of the Party and State.
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Ministry of Finance wants to expand tax base for inheritance and gifts |
There is much debate
Regarding this proposal, experts also have mixed opinions.
Associate Professor, Dr. Phan Huu Nghi, Deputy Director of the Institute of Banking and Finance, National Economics University, agrees with the taxation, but specific regulations are needed to ensure policies are consistent with reality.
According to him, currently, income from inheritance within the family (including spouses, parents, and children) is tax-free. However, according to international practice, most countries apply inheritance tax to ensure fairness and avoid budget losses. Meanwhile, Vietnam does not have a Property Tax Law.
The current trend in countries is to separate tax management for the super-rich and Vietnam also needs to study the management and transfer of assets of the super-rich. Because this group is a small number but accounts for the majority of assets in society and assets of great value.
According to the expert, to adjust in line with international practice, it is possible to consider applying a tax rate of 15% - 20% on large inherited assets, similar to the tax rate applied in some developed countries.
There should be a threshold value for tax exemption or low tax rate for assets of small or not large value to avoid impacting households that are not in the high-income group but have inherited assets as gifts.
In addition, some countries apply tax incentives for heirs who have directly cared for and raised their parents or relatives for many years. If Vietnam applies this policy, heirs can have their tax rates reduced to 5%-10%, or be completely exempted from tax in some special cases such as the elderly, the disabled, etc.
“Expanding the tax base and taxpayers for income from inheritance and gifts not only helps ensure fairness in the tax system, but also limits tax evasion and accumulation of assets by all means for the next generation, while increasing revenue for the budget and ensuring transparency in asset declaration,” said Associate Professor, Dr. Phan Huu Nghi.
On the contrary, Dr. Nguyen Ngoc Tu, Lecturer at Hanoi University of Business and Technology, believes that taxing income on inherited and donated assets is not necessary at this time.
According to him, for Western countries, paying income tax on donated and inherited assets has become a natural habit for developed economies. There is a good social security system, people are supported by the government in many ways. Therefore, adults have a high level of independence, less dependent on parents or family. Therefore, when receiving an inheritance, income tax must be paid, even at a fairly high rate, because this asset was not created by the efforts of the beneficiary.
For Vietnam, which originated from an agricultural economy, the forms of giving and inheriting property have become traditional cultural features. Many generations of grandparents and parents often take care of their children and grandchildren to settle down early, despite many difficulties in life, but never sell the property and land left by their ancestors but leave it to their children and grandchildren.
“Reality also shows that the donation and inheritance of assets in Vietnam is essentially just a transfer between family members, without any buying, selling or transferring activities on the market. Therefore, the legal system in general and the new tax law in particular should respect the national cultural characteristics regarding the issue of property ownership and inheritance, and it is not necessary to impose income tax at this time,” said Mr. Tu.
Source: https://www.anninhthudo.vn/danh-thue-tai-san-thua-ke-qua-tang-chuyen-gia-noi-gi-post606462.antd
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