Consider exempting personal income tax to stimulate demand

One of the important contents that attracted a lot of attention from the public and the business community nationwide at the 3rd Session of the 13th National Assembly was the draft Resolution of the National Assembly on tax solutions to remove difficulties for businesses and individuals in 2012.

On the morning of June 12, discussing the draft Resolution, delegates expressed their high agreement with the Government's proposal; stating that the issuance of solutions to help remove difficulties for production, business, and support the market is necessary in the context that businesses are facing great difficulties in terms of capital and output of goods.

Minister of Finance Vuong Dinh Hue presents the Draft Report. (Photo: Nhan Sang/VNA)

The majority of opinions in the Finance and Budget Committee agreed with the Government's proposal and said that the 30% reduction in corporate income tax at the present time, along with the implementation of other groups of solutions, will contribute to solving financial difficulties for businesses by providing them with additional working capital while borrowing from banks is difficult due to high lending conditions and interest rates.

Delegate Mai Huu Tin (National Assembly Delegation of Binh Duong Province) suggested that the Government review the criteria for ranking small and medium-sized enterprises in a more reasonable manner so that more subjects can benefit from the policy. Delegate Mai Huu Tin also expressed his approval for reducing value-added tax (VAT) and corporate income tax; believing that this is an effective solution for businesses at this time, especially small and medium-sized enterprises.

The audit report of the National Assembly's Finance and Budget Committee as well as many opinions discussed in the hall also expressed disagreement with the plan to exempt VAT, corporate income tax and personal income tax as proposed by the Government because they believe that these proposals do not bring practical results, the impact is insignificant; determining the subjects eligible for tax exemption is not feasible.

Not satisfied with the Government's solutions, delegate Nguyen Thanh Hai (Hoa Binh) suggested that the Government should introduce more practical tax reduction measures for businesses to reduce their input costs. Because solutions to reduce corporate income tax and personal income tax, VAT are also practical measures to stimulate investment and consumption. These solutions must also go hand in hand with strict control in their application and implementation in practice.

Notably, also at the discussion, many opinions of delegates suggested that the National Assembly and the Government consider exempting personal income tax for individuals with taxable income from salaries, wages and business to the level of personal income tax at level 1 (as in Resolution No. 08/2011/QH13 of the National Assembly) and reducing VAT to stimulate consumption in order to contribute to supporting the removal of difficulties for businesses.

Delegate Do Van Ve (Thai Binh) proposed that the National Assembly immediately reduce 50% of VAT on all goods; for individuals with taxable income from salaries, wages and business to the level of personal income tax at level 1 to support workers to improve their lives. Delegate Do Van Ve affirmed that these are indirect measures with strong effects in stimulating consumption, contributing practically to supporting business production and supporting people's lives.

Sharing this view, delegates: Tran Thanh Hai; Tran Du Lich (Ho Chi Minh City) proposed that the National Assembly study the application of exemption of personal income tax level 1 for salaried workers. Delegate Tran Du Lich proposed that it should not be limited as in the Government's proposal, the reduction of VAT must be studied and expanded to more fields and subjects to have practical value.

Delegate Tran Du Lich also expressed his opinion that in order to create trust for the business community, the National Assembly and the Government need to have a clear message from 2013, and will consider reducing corporate income tax by 25-30%, creating a strong motivation for businesses to feel secure in production and business.

Also this morning, with 88% of delegates in favor, the National Assembly passed a Resolution on the National Assembly's Law and Ordinance Building Program in 2013; adjusting the law and ordinance building program in 2012 and the 13th National Assembly term.

According to the draft Resolution, in the 2012 Law and Ordinance Development Program, the National Assembly decided to add the draft Law on Anti-Corruption (amended) to the Program for approval at the 4th session; and transfer the draft Law on Land from the Program for comments at the 4th session to the Program for comments at the 5th session.

The National Assembly also decided to add to the Law and Ordinance Building Program of the 13th National Assembly the following projects: Law on Enterprises (amended); Law on Investment (amended); Law on Promulgation of Administrative Decisions; Law on Practicing Thrift and Combating Wastefulness (amended); Ordinance amending and supplementing a number of articles of the Ordinance regulating the state honorary title “Heroic Vietnamese Mother”; Ordinance on procedures for considering and deciding on the application of administrative measures at the People's Court.

Regarding the 2013 law and ordinance making program, the National Assembly passed 32 draft laws, 4 draft ordinances in the official program, and 18 draft laws in the preparation program./.

According to (TTXVN) - DT