Viet Nam to raise monthly personal income tax deductions from 2026
VGP - Viet Nam will raise its personal income tax deductions starting March 2026, increasing the standard deduction for taxpayers to VND15.5 million (US$589) per month and the dependent deduction to VND6.2 million (US$235.5) per month.
The revision of monthly personal income tax deductions reflects growth in per capita income and GDP as well as rising living costs
The National Assembly Standing Committee approved the adjustment on Friday, marking the first change to deduction levels since 2020.
The new rates represent increases of more than 40 percent compared with the current levels of VND11 million (US$417.7) for taxpayers and VND4.4 million (US$167) per dependent.
Under this plan, the deduction for taxpayers would increase to around VND15.5 million per month, and to VND 6.2 million per month per dependent. A taxpayer earning US$17 million per month would not owe PIT after standard deductions and insurance contributions. This option would reduce state revenue by about VND21 trillion per year.
Deputy Minister of Finance Nguyen Duc Chi said the revision reflects growth in per capita income and GDP as well as rising living costs.
Deduction levels must align with changes in living expenses, which are influenced not only by CPI but also by shifts in income, GDP, and average consumption over time. According to the General Statistics Office, average income and GDP per capita have both risen by around 40–42 percent since 2020.
Under the new policy, individuals earning from VND17.285 million (US$656.5) per month without dependents will be subject to income tax at the lowest rate of five percent. The taxable income threshold will rise to VND24.22 million (US$919.7) for those with one dependent and VND31.155 million (US$1,138) for those with two dependents.
The Ministry of Finance estimated that the adjustment will reduce annual state budget revenue by approximately VND21 trillion (US$797.4 million)./.
