From July 1, 2024, the basic salary has increased from VND 1.8 million/month to VND 2.34 million/month (an increase of 30%), according to Decree 73/2024/ND-CP of the Government. The salary increase has brought joy to tens of millions of cadres, civil servants, public employees, workers in the public sector and retirees. This is a policy suitable for the current situation of our country's economy.
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| Workers want to increase their salary but also need to increase the family deduction level accordingly to suit reality (Illustration photo) |
Therefore, in recent days, the story of salary increase has always been the most mentioned topic in the story from the office to the factory and on social networks. Most workers are happy to get a salary increase, especially when the basic salary, pension and social insurance benefits have the highest increase in the history of salary increase.
Salary increases are something that all workers look forward to. However, in addition to the joy of the increase in the basic salary, many people are worried about the price of goods "falling with the salary". At the same time, if the salary increase is not accompanied by a solution to increase the taxable income threshold for family deductions, it will put pressure on salaried workers to pay income tax.
Therefore, employees expect that when the new salary level is applied, the family deduction level in calculating personal income tax should also increase accordingly to suit the current reality of life.
According to the provisions of the Personal Income Tax Law from 2020 to present, the family deduction for taxpayers is 11 million VND/month and for each dependent is 4.4 million VND/month. After more than 4 years of maintenance, this family deduction is considered outdated and no longer suitable for actual conditions.
For that reason, in addition to increasing wages and curbing inflation, many opinions recommend that the Government should soon submit 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 to ensure synchronous adjustment of the legal system as well as benefits for workers.
Ms. Nguyen Thi Thuy, Standing Member of the National Assembly's Judicial Committee, commented that the family deduction, especially the deduction for dependents of VND 4.4 million/month, is too outdated, so the Personal Income Tax Law needs to be considered and amended by the National Assembly soon, and should not wait until 2 more years (2026) to be passed as proposed.
Specifically analyzing, Ms. Thuy said that the deduction for dependents of 4.4 million/month is really no longer suitable for current reality, especially in big cities, causing disadvantages for taxpayers.
This deduction of 4.4 million has been maintained since 2020, while in the past 5 years, many essential goods and services have increased, and some essential goods and services have even increased faster than income.
Many voters shared that if a family has young children and has to hire a babysitter, the salary for the babysitter alone is currently not less than 5 million VND/month, not to mention the expenses for the children. If a family has children going to school, the cost of education currently accounts for the majority of the family's spending structure. If a family has elderly parents as dependents, it is not only the cost of food and living expenses but also medical expenses, medicine, etc.
Therefore, the current regulations on family deductions do not truly reflect the basic spending of families and individuals, nor do they reflect the reality of life today. If we have to wait another 2 years for the Personal Income Tax Law to be passed as proposed, many people will have to "tighten their belts" but still have to pay personal income tax.
On the other hand, it also shows the unreasonableness in calculating according to the CPI basket of goods. According to the provisions of Article 19 of the Law on Personal Income Tax, when the CPI fluctuates by more than 20%, the Government submits to the National Assembly Standing Committee to adjust the family deduction level.
At the regular press conference, the representative of the Ministry of Finance said that there was no proposal to adjust the family deduction level because the CPI fluctuation was less than 20%. However, many experts and voters said that the current Personal Income Tax Law using the criterion of CPI fluctuation of over 20%, which means it must be based on a basket of goods including 752 items, is unreasonable. Meanwhile, essential goods that directly affect people's spending are only about 20 items, while waiting to calculate the average price of 752 items will take a long time to get the family deduction level, even 6-7 years. 6-7 years is too long a period of time, will not promptly reflect the fluctuations in spending of people and households, thus causing disadvantages to people.
Speaking more about the family deduction regulation, currently, this deduction is not suitable for the conditions of a country with a low average income like ours. Because it is a country with a low average income, most of the people's income will be spent on essential goods and services, for example, with an income of 10 million VND/month, the spending on essential goods and services accounts for 70%.
A survey by experts from the National Economics University shows that in countries where people have high incomes equivalent to about 100 million VND/month, spending on essential goods and services only accounts for 30-40%, so the current regulations on family deductions will directly affect people's spending on essential needs.
Wages increase but personal income tax and family deductions are not adjusted in a timely manner, which will lead to problems. Wages increase but personal income tax and family deductions are not adjusted in a timely manner, which will cause anxiety for workers, because wage increases mean taxable income will increase. Therefore, failure to adjust in a timely manner will also directly affect the meaning of the wage reform policy...
Source: https://congthuong.vn/muc-giam-tru-gia-canh-44-trieu-dongthang-lieu-con-phu-hop-trong-boi-canh-tang-luong-co-so-332592.html
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