The Ministry of Finance plans to reduce the tax burden on individual owners | Business
Hanoi (VNS / VNA) – The General Directorate of Taxation of the Ministry of Finance (MoF) is studying a proposal to raise the threshold of
taxable revenue for individual owners rental of houses.
This is part of the value-added tax (VAT) law amendment program that the general department is consulting with experts, said Ta Thi Phuong Lan, deputy director of the small and medium-sized enterprise tax administration department. , households and individuals. under the general direction of taxation.
According to experts, the threshold for rental property tax for individuals is not suitable for the real situation because the current tax rate is quite high and the threshold too low.
Individuals who rent houses or apartments have to pay the highest tax rate at 10% compared to many other types of service businesses (4.5% to 7%).
In addition, the threshold for this tax of over 100 million VND (4,255 USD) per year or approximately 8.3 million VND per month is also not suited to market performance. Especially in big cities like Hanoi and Ho Chi Minh City, with this threshold most home / apartment owners have to pay this tax.
For example, if an individual renting a house has a turnover of 200 million VND per year or approximately 16.7 million VND per month, he must pay a tax of 20 million VND, of which 10 million VND is value added tax and 10 million VND for individuals. income tax, declared chinhphu.vn.
Some experts suggest that the threshold for paying taxes should be adjusted from 30% to 40% to match the inflation rate that has exceeded 20%.
Nguyen Thi Cuc, president of the Vietnam Tax Advisory Association, told Thoi bao Tai chinh Viet Nam (Vietnam Financial Times) that for personal income tax, it is reasonable to study and adjust the threshold of taxable income.
This taxable income threshold adjustment applies not only to rental real estate activities, but also to other business activities of individuals that can be adjusted to increase, such as business activities (including e-commerce), manufacturing, construction and other services.
The taxable income threshold can be raised to around VND 150 million per year or more to be more reasonable than maintaining the current level, Cuc said.
For nearly six months, Nguyen Thi Lan Huong, owner of an apartment in Hanoi, has been unable to find tenants even though she reduced rent by almost 50% due to the COVID-19 pandemic.
According to Huong, the taxable income threshold of VND 100 million per year is low and needs to be raised to a higher level due to the impact of additional expenses such as maintenance and insurance costs and depreciation of property. fixed assets.
“If the tax rate is high, the rental price will also be increased, which will make it more difficult to rent. I hope there will be a reasonable tax rate to harmonize the lessor and the lessee,” Huong told VTV.
As for tenants like Nguyen Thanh Hien in Hanoi, she also wants the tax to be reduced so that the rent can be lower because the tax is always included in the rent and ultimately the tenant has to pay this tax.
Lan of the General Tax Department said the existing regulations did not take into account additional expenses related to real estate leasing activities such as maintenance, installation costs and interior equipment.
Therefore, the tax policy provides for a lower tax rate for individuals than for businesses. More specifically, the value added tax is 5% for individuals and 10% for businesses. Personal income tax is 5 percent for individuals and 20 percent for businesses. /.