Income that has just improved is now being burdened with taxes.

After 10 years, according to Report No. 164/CQLG-CSTH dated April 26, 2023, the commodity market report for March 2023 shows that the average price of paddy rice was 12,200 VND/kg, equivalent to a 43% increase compared to 2013. The price of carp was 80,700 VND/kg. The average price of cabbage was 14,100 VND/kg.

Ten years ago was also the time when the personal allowance stipulated in the Personal Income Tax Law was amended for the first time. Accordingly, from July 1, 2013, the allowance for taxpayers was 9 million VND/month (108 million VND/year); the allowance for each dependent was 3.6 million VND/month.

For the 2020 tax year, the personal allowance for taxpayers was further adjusted to 11 million VND/month (132 million VND/year); the allowance for each dependent was 4.4 million VND/month.

Since its enactment in 2009, the personal allowance has been adjusted twice to reflect the changing circumstances.

According to Associate Professor Pham The Anh, Head of the Economics Department at the National Economics University, one of the most frequently cited shortcomings is the personal allowance deduction. "The law stipulates that the personal allowance deduction can only be adjusted when inflation reaches 20%, but it's clear that many problems have arisen in practice," said Associate Professor Pham The Anh. In reality, some basic goods have increased 2-3 times between 2013 and 2020, not just 20%. Furthermore, the expert believes that if inflation remains around 15-17% for an extended period, adjustment is not feasible, but consumers and households will ultimately suffer.

Speaking to Lao Dong newspaper, Associate Professor Dr. Dinh Trong Thinh - a lecturer at the Academy of Finance - even stated that the regulation stipulating that taxable income levels should only be adjusted when the CPI fluctuates by more than 20% is unreasonable.

He stated that people's living standards are improving, especially in large cities. A 5% inflation rate this year is different from a 5% inflation rate next year; they are not the same. Therefore, there is no need to set a 20% ceiling.

People are both happy and worried about the wage increase.

Sharing his insights with taxpayers, Dr. Nguyen Ngoc Tu, a tax expert and lecturer at the Hanoi University of Business and Technology, stated that for people in large cities like Hanoi or Ho Chi Minh City, the cost of living is very high. In fact, income levels are often insufficient to make ends meet.

Sharing the same view, Mr. The Anh also noted that even a slight improvement in people's income would immediately lead to the new tax rate, which peaks at 35%, a very high rate compared to middle-income countries.

For example, Mr. Thinh said that this year the regional and basic salaries have increased, bringing more joy to the people. However, a number of individuals who previously earned around 8-9 million VND/month will be subject to taxation after the salary and income increase. Therefore, the increase in income is both something to celebrate and something to worry about.

As shared with Lao Dong newspaper, Pham Thi My (Ha Dong) - a teacher at a private high school in Hanoi - said that her current monthly income ranges from around 30 million VND, which is the net amount received after deducting monthly personal income tax.

Being young, My took on as many teaching hours as possible. In addition, she was a homeroom teacher and participated in extracurricular activities, so her income was slightly higher than other teachers. However, this income was still not enough to cover all of her family's expenses, such as medical care, rent for her and her husband, and support for her parents.

"My husband and I aspire to buy a house in Hanoi to settle down, but currently my husband is behind on salary payments, and most of our family expenses depend on my salary. My father is seriously ill, so I still send him money for medication every month. In addition, I am undergoing treatment so that I can have a baby in 2024," My shared.