Inadequacies in the personal income tax’s progressive tax rates and reduction based on family circumstances - some recommendations for improving personal income tax regulations

Personal income tax is one of the most important revenue sources for the state budget. Personal income tax is mandatory for all liable citizens in order to contribute to national development. In Vietnam, the personal income tax’s progressive tax rates have not been changed, but the reduction based on family circumstances has been changed for the third time in 2020. However, the tax reduction is no longer consistent with the changes in people's lives as the prices of goods and services have increased. This paper points out the inadequacies in the personal income tax’s progressive tax rates and reduction based on family circumstances. Based on the paper’s findings, some solutions are proposed to improve personal income tax regulations to keep up with economic development and changes in people's income.