Adjustment of deductions for family circumstance consistent with price fluctuation

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Deputy Minister of Finance answered the press at the meeting.

On March 3, at aGovernmentpress conference, Deputy Minister of Finance Vu Thi Mai provided the specific information on the draft resolution of the National Assembly Standing Committee on adjustingthe deduction level for family circumstance of Personal Income Tax.

On February 28, the Ministry of Finance issued a dispatch for comments on the draft.

Thededuction for family circumstance for the tax payer will increasefrom VND 9 million/month to VND 11 million/month, for the dependent of the tax payer from VND 3.6 million/month to VND 4.4 million/month.

This provision is expected to reduce difficulties for the tax payer in the context that the price and inflation have increased compared to 2013.

Deputy Minister Vu Thi Mai said the level of deduction for family circumstance is based on the provisions of Clause 4, Article 1 of Law No. 26/2012/QH13. The provision stipulates that in case the Consumer Price Index (CPI) changes over 20 percentcompared to the effective time of the law or the latest time point of adjusting the deduction based on family circumstances, the Government submits to the National Assembly Standing committee for adjustment of the deduction based on family circumstances specified in this clause in conformity with changes of price in order to apply for the next tax term.”

According to Deputy Minister Vu Thi Mai, statistics of the General Statistics Office said by the end of June 2019, the CPI increased by 18.7 percent; By the end of December 2019, CPI increased by 23.2 percent. Therefore, the Ministry of Finance has calculated a deduction level for family circumstance.

“The deduction level for family circumstance is in accordance with the regulations and based on the CPI. The adjustment is consistent with price fluctuation,” Mai said.

Regarding tax administration for celebrities, singers, online businessmen andfamous individuals on YouTube andFacebook, Deputy Minister Vu Thi Mai said the Tax Administration Law will take effect from July 1, 2020 and provides a basis for stricter management as well as specifying responsibilities of ministries and sectors to manage these people. Therefore, these peopleneed to improve their responsibilities in full and honest declarations.

Regarding the tax authority side, Deputy Minister of Finance Vu Thi Mai said tax authorities need to strengthen support and publicity for tax payers to comply with the provisions, as well as conduct inspection and examination to ensure compliance with the law.