Proposed monthly income above 28.6 million VND must pay tax

On May 19, the Ministry of Finance just submitted to the Government a draft Decree stipulating a number of articles on the Personal Income Tax Law, which specifically proposed family deductions for medical and educational expenses.

Accordingly, taxpayers can receive a maximum deduction of VND 47 million per year for medical, education and training expenses before calculating personal income tax.

Specifically, expenses for medical examination and treatment at domestic medical facilities are reduced by no more than 23 million VND per year. Education and training costs at domestic establishments are reduced by no more than 24 million VND per year. These items must have invoices and documents, in which medical expenses must include a list of medical examination and treatment costs used at facilities according to regulations of the Minister of Health.

According to this option, taxpayers who have 1 dependent and incur medical, education and training expenses can receive a deduction of up to 307.3 million VND per year, or 28.63 million VND per month. This amount includes: 15.5 million VND/month for the taxpayer himself, 6.2 million VND/month for a dependent and a maximum amount for medical and educational expenses of 47 million VND per year.

Thus, taxpayers with income over 28.63 million VND a month must pay tax at a tax rate starting from 5%.

The Personal Income Tax Law was amended by the National Assembly last year to supplement regulations related to deductions for health and education of taxpayers and dependents.

According to data from the Resident Living Standards Survey, the average spending on health in 2024 per person is 3.5 million VND per year, 10.2 million VND for boarding, and 9.6 million VND for education and training. The Ministry of Finance calculates that the current spending of a dependent and the taxpayer himself is about 20 million VND per year for health and 21 million VND for education and training.

Thus, the proposed maximum medical deduction is 2.3 times and education – training is 2.5 times the average spending on education – training of individuals in 2024.

According to the Ministry of Finance, the total annual family deduction for a taxpayer can be nearly 2.45 times the average income per capita in 2025 (125.5 million VND). This regulation helps reduce tax obligations for all taxpayers with medical, education and training expenses. At the same time, taxpayers in lower tax brackets will receive tax reduction at a higher rate.

This Ministry calculates that implementing the above plan will reduce budget revenue by about 7,697 billion VND per year.

The Decree is expected to take effect from July 1 to be consistent with the Personal Income Tax Law 2025.