Vietnam may see personal tax changes sooner than expected

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The Ministry of Finance may speed up the process of amending the personal tax law to provide support for local taxpayers struggling with high consumer prices, Minister Vuong Dinh Hue said.

The amendments are expected to be passed when legislators meet in mid-2013 and take effect in the following six months, but if there is "strong consensus" it can be done sooner, Hue said in an interview on Saturday's Vietnam Economic Times.

"Inflation has been controlled, rising only 2.6 percent so far this year. However, prices are still hight, so we think it is necessary to change the law as soon as possible," he said.

The Ministry of Finance in March announced its plan to raise the threshold for personal income tax to VND6 million per month from the current level of VND4 million.

The proposed amendment, however, has not received strong support from the public, with many taxpayers arguing that the increase would not be very meaningful when it comes into effect in 2014.

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Hue said in the interview that officials "are listening" to all opinions and will ensure the interests of both the state budget and taxpayers. He did not say whether the proposed taxable threshold would be raised in response to the criticism.

Vietnam passed the Personal Income Tax Law in 2007. Since then taxypers have been calling for amendments to keep the law up to date with the fast pace of price hikes.

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