Fixing interest rates for home loans, increasing pensions and social insurance benefits from the beginning of 2022

Increase pensions and social insurance benefits

According to Decree 108 of the Government, those who are receiving pensions and social insurance (SI) benefits, monthly benefits will be increased by 7.4% compared to December 2021. This increase will be applied from January 1, 2022.

After making adjustments according to the above increase, if the pension, social insurance benefits, and monthly allowances are still lower than 2.5 million VND/month, those who retired before 1995 will be further increased at the following levels:

- Increase by 200,000 VND/person/month if the benefit level is 2.3 million VND/person/month or less.

- Increase by 2.5 million VND/person/month if the benefit level is from 2.3 million VND to less than 2.5 million VND/person/month.

Vinh City Post Office pays pensions at home during the Covid-19 pandemic prevention period in April 2020. Photo: Duc Anh

Income under 2 million VND/month in the city is considered poor

This is the content of Decree 07/2021/ND-CP on multidimensional poverty standards, replacing Decision 59 issued in 2015. Specifically, from 2022, households with an average income per capita/month of VND 2 million or less in urban areas and VND 1.5 million or less in rural areas; lacking 3 or more indicators measuring the level of basic social service shortages are considered poor households.

Previously, in urban areas, a household had to have an average monthly income per capita of VND900,000 or less; or over VND900,000 - VND1.3 million and a shortage of three or more indicators measuring the level of lack of access to basic social services to be considered a poor household. In rural areas, a household had an average monthly income per capita of VND700,000 or less; or over VND700,000 - VND1 million and a shortage of three or more indicators measuring the level of lack of access to basic social services.

Increase the retirement age of workers

Implementing the roadmap to increase the retirement age of employees according to the 2019 Labor Code, in 2022, the retirement age of male and female employees will continue to be adjusted upwards. Specifically, in 2022, male employees will retire at the age of 60 years and 6 months, an increase of 3 months compared to the prescribed retirement age of 2021, and female employees will retire at the age of 55 years and 8 months, an increase of 4 months compared to 2021.

In case of declining health or doing heavy, toxic, dangerous work, or working in particularly difficult areas, employees can retire at an age 5 - 10 years lower than the age specified above.

Gasoline prices are adjusted every 10 days.

Decree 95 amending Decree 83 on gasoline and oil trading will take effect from January 2, 2022.

Decree 95 stipulates that gasoline prices will be adjusted on the 1st, 11th and 21st of each month (i.e. every 10 days). If it falls on a holiday, it will be postponed to the next working day after the holiday; if it falls on the Lunar New Year holiday, it will be postponed to the next adjustment period.

Previously, Decree 83/2014/ND-CP stipulated that the interval between two consecutive price adjustments was at least 15 days for price increases and at most 15 days for price decreases. The shortening of the interval between two price adjustments for gasoline under Decree 95 is believed to be aimed at avoiding the current situation of shocking price increases and slow price decreases.

Change the penalty level for many violations related to invoices

From January 1, 2022, there will be many new regulations that accountants need to update, one of which is the fines related to invoices according to Decree 102 of the Government. This Decree stipulates a fine of 4 - 8 million VND for cases of issuing invoices but not fully recording the required contents on the invoice according to regulations, while previously there were no regulations on penalties for this behavior.

Similarly, for the act of losing, burning, or damaging invoices that have been issued but not yet declared for tax, Decree 102 also stipulates a fine of 4-8 million VND and the parties must make a record of the loss, burning, or damage of the invoice. Previously, there were no penalties for this act. Notably, the new Decree increases the statute of limitations for handling administrative violations in the field of invoices to 2 years, instead of 1 year as before.

Changes in tax treatment for landlords

Also effective from January 1, 2022 is Circular 100 of the Ministry of Finance with new regulations on tax calculation for house renters. According to Circular 40 issued not long before, if an individual renting a house does not generate revenue for 12 months in a calendar year, the revenue level of 100 million VND per year or less to determine that the individual renting a house does not have to pay value added tax, personal income tax is the revenue for calculating personal income tax of a calendar year (12 months).

Circular 100 adjusts as follows: If an individual only has house rental activities, the rental period is not a full year, and the revenue is 100 million VND/year or less, then he/she is not subject to value added tax and personal income tax.

Also according to Circular 100, e-commerce platforms such as Shopee, Lazada, Tiki... will not be required to pay taxes on behalf of sellers; this obligation only arises if there is an authorization contract between the e-commerce platform and the seller. While the previous Circular 40 stipulates that this is a mandatory obligation for e-commerce platforms.

Officially penalize transport business cars that do not install surveillance cameras

Starting from January 1, 2022, car owners in the transport business need to pay close attention: If the car does not have a surveillance camera, it will be fined according to the provisions of Resolution 66 of 2021 of the Government.

The above penalty regulations were supposed to be applied from July 1, 2021 according to Decree 100 of 2020. However, the Government then continued to issue Resolution 66 to temporarily suspend the above penalty until December 31, 2021. That is, from January 1, 2022, commercial transport vehicles including: Taxis, passenger cars, buses, contract cars... are required to install surveillance cameras, otherwise they will be fined from 1 to 2 million VND.

No garbage classification, no collection

Also from January 1, 2022, the Law on Environmental Protection 2020 officially took effect. One of the most notable contents of this Law is the strict regulation on the obligation to classify household waste of each family and individual.

Specifically, households and individuals who do not classify waste will be refused collection and transportation, and may even be notified to competent authorities for inspection and handling according to regulations (Currently, according to Decree 155 of 2016, not classifying waste can result in a fine of 15 - 20 million VND).

In addition, the new Law also stipulates that the price of household waste collection and transportation services will be calculated based on the mass or volume of classified waste, meaning that from January 1, 2022, the more waste a family or individual discharges, the more money they will have to pay.

Before the new law, waste collection fees were calculated on a leveling system, with people who littered a lot or a little paying the same fee. This was considered unfair and did not create an incentive for people to limit littering and contribute to environmental protection.

Setting interest rates for home loans in 2022

In late 2021, the State Bank of Vietnam also issued Decision 1956 setting the interest rates of commercial banks applicable in 2022 for outstanding loans for home purchases. This interest rate is set at 4.8%/year, equal to the interest rate in 2021 and down 0.2%/year compared to 2019 and 2020.

Eligible borrowers are: Cadres, civil servants, public employees and low-income earners who need to borrow capital to buy social housing or to buy commercial housing with an area of ​​less than 70m2, selling price under 15 million VND/m2; or to buy commercial housing in housing development projects, urban area construction investment projects with a total contract value of no more than 1.05 billion VND...

Unilateral leave of absence if sexually harassed abroad

From January 1, 2022, the Law on Vietnamese Workers Working Abroad under Contracts officially took effect. The new law has many provisions to protect the rights of Vietnamese workers abroad, typically the provision allowing workers to unilaterally terminate their contracts when they are mistreated, forced to work or sexually harassed by their employers while working abroad.

In addition, the Law also stipulates that labor export workers do not have to pay social insurance or personal income tax twice in Vietnam and in the country of work, if the two countries have signed an agreement on social insurance or an agreement to avoid double taxation. Notably, the Law strictly prohibits the collection of brokerage fees from labor export workers.