Commenting on the draft proposal to build the Personal Income Tax Law (replacement) of the Ministry of Finance recently, the People's Committee of Can Tho City proposed to expand the scope of personal income tax (PIT) on savings interest, only exempting PIT on small savings deposits.

According to current regulations, individuals who have interest on deposits (in the form of term or non-term deposits, savings deposits, deposit certificates, promissory notes, treasury bills and other amounts subject to the principle of full repayment of principal and interest) received from credit institutions and foreign bank branches are exempt from tax.

Only income from interest on deposits of companies and enterprises is subject to corporate income tax.

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In many countries, interest is also a source of income subject to personal income tax. Illustration: Nam Khanh

In the draft of the Personal Income Tax Law (replacement), the Ministry of Finance cited the experience of several countries showing that in Thailand, taxable income is divided into 8 categories, including income from dividends and interest on bank deposits.

Similarly, in China, the Personal Income Tax Law stipulates nine types of income subject to personal income tax, including income from interest, dividends, and profit distribution.

And in Korea, interest is also a type of income subject to personal income tax.

Countries often have principled regulations to ensure coverage of other income (or income of an unusual nature) of individuals.

The Ministry of Finance believes that, along with the development of socio-economic life and new forms of business activities, a number of other personal incomes have arisen in addition to the prescribed taxable incomes, which are similar in nature to some irregular incomes (current income) currently subject to personal income tax, such as income from royalties, income from franchising, etc.

“The scope of determining taxable income under the law on personal income tax is generally consistent with Vietnam's recent practice and international practice.

However, with the diversity of sources of income of individuals, it is necessary to study the amendment and supplementation of regulations on taxable income to ensure more coverage of current reality in the direction of adding other income groups (the Government shall specify in detail) or specify other revenues to ensure fairness among individuals with income, ensuring compliance with the principles of personal income tax and international practices", the Ministry of Finance emphasized.

Many years ago, there was a proposal to tax personal income tax on large savings interest because this amount is similar to investing in stocks, real estate...

However, many opposing opinions say that it is necessary to exempt tax on interest on bank savings deposits, government bonds... to encourage savings and economic development.

According to Article 3 of the Law on Personal Income Tax, there are 10 types of income subject to tax, including: (1) Income from business; (2) Income from salaries and wages; (3) Income from capital investment; (4) Income from capital transfer; (5) Income from real estate transfer; (6) Income from winning prizes; (7) Income from royalties; (8) Income from franchising; (9) Income from inheritance; (10) Income from receiving gifts.
Where to submit personal income tax settlement documents when changing workplace? When transferring from company A managed by the Large Enterprise Tax Department to company B managed by the Ho Chi Minh City Tax Department, which tax authority will the person directly subject to personal income tax settlement have to submit the settlement documents to?