Insiders blast new personal tax law's long delay ? TalkVietnam

The personal tax law amendment that has recently been approved by the government seems at first to be good news for tax payers, but their joy would immediately fade away when they notice the application date, which is exactly one year away.

For illustration purposes only

The new law proposes to increase the personal tax threshold to VND9 million a month, up from the current VND4 million, and the deduction for dependents, defined as those whose monthly income is less than VND500,000, will also be raised from VND1.6 million to VND3.6 million a month. (VND1 million = US$48)

But it is not until July 1, 2013 that taxpayers can enjoy this tax relief.

It is because ?the ministry needs time to compose relevant decrees and circulars, amend the tax calculation software, and train tax officers,? said Deputy Minister of Finance Vu Thi Mai in a press briefing Tuesday.

The explanation, however, does not please taxpayers and analysts.

?The amendment only focuses on increasing the tax threshold and dependent deduction, so it is illogical for such a small change to take a year to be implemented,? said economic expert Le Dang Doanh, former head of the Central Institute for Economic Management.

Doanh, who holds a doctorate decree, added that: ?The explanation may send taxpayers into thinking that the finance ministry is trying to prolong the old tax rule as much as possible to meet their tax collection target.?

He also demanded that the norm to identify an individual as a dependent should be revised.

?The VND500,000 ceiling is totally outdated at this time of high prices,? he asserted.

Lawyer Nguyen Dang Trung, from the Ho Chi Minh City Law Association, also lodged that it is unnecessary for the new rule to be delayed for a year.

The bill is set to be submitted to the National Assembly in October, and Trung said it is well suitable to take effect as of the beginning of next year.

Amid these hard times of poor consumption, the lawyer said the tax relief will help ease the public?s burden and economic turbulence.

?If the date proposed by the finance ministry is unreasonable, the NA should intervene and set a nearer time,? he urged.

Source: http://talkvietnam.com/2012/08/insiders-blast-new-personal-tax-laws-long-delay/

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