What is the minimum salary used as basic for Social Insurance premiums from July 1, 2025? Is the minimum salary used as basic for Social Insurance premiums equal to the reference level in Vietnam?
What is the minimum salary used as basic for Social Insurance premiums in Vietnam from July 1, 2025?
On June 29, 2024, the National Assembly passed the Social Insurance Law 2024, which takes effect from July 1, 2025.
According to Article 31 of the Social Insurance Law 2024, the basis for social insurance contributions is stipulated as follows:
Basis for Social Insurance Contributions
1. Salaries used as the basis for compulsory social insurance contributions are defined as follows:
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d) The minimum salary for compulsory social insurance contributions is equal to the reference salary, and the maximum salary is 20 times the reference salary at the time of contribution.
2. The minimum income used as the basis for voluntary social insurance contributions is equal to the rural poverty line, and the maximum income is 20 times the reference salary at the time of contribution.
3. The Government of Vietnam shall detail the provisions in point b, clause 1 of this Article; prescribe the collection and back-payment of compulsory social insurance contributions.
Thus, according to the above provision, from July 1, 2025, the minimum salary for compulsory social insurance contributions is equal to the reference salary.
Article 7 of the Social Insurance Law 2024 defines the reference salary as the amount decided by the Government of Vietnam, used to calculate the level of contributions and benefits for certain social insurance benefits stipulated in the Social Insurance Law 2024.
The reference salary is adjusted based on the increase in the consumer price index, economic growth, and in accordance with the capability of the state budget and social insurance fund.
Additionally, clause 13, Article 141 of the Social Insurance Law 2024 stipulates as follows:
Transitional Provisions
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13. When the statutory pay rate has not been abolished, the reference salary defined in this Law is equal to the statutory pay rate. At the time the statutory pay rate is abolished, the reference salary must not be lower than the statutory pay rate.
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Based on these provisions, from July 1, 2025, the minimum salary for compulsory social insurance contributions is equal to the reference salary. If by this time the statutory pay rate has not been abolished, the reference salary is equal to the statutory pay rate.
Additionally, the minimum income used as the basis for voluntary social insurance contributions is equal to the rural poverty line.
What is the minimum salary used as basic for Social Insurance premiums in Vietnam from July 1, 2025? (Internet image)
What are the social insurance benefits in Vietnam from July 1, 2025?
According to the regulations in Article 4 of the Social Insurance Law 2024, the insurance policies are as follows:
(1) Social retirement allowance includes the following policies:
- Monthly social retirement allowance;
- Funeral cost support;
- Health insurance coverage by the state budget.
(2) Compulsory social insurance includes the following policies:
- Sickness;
- Maternity;
- Retirement;
- Death benefits;
- Work injury and occupational disease insurance as prescribed by the Law on Occupational Safety and Health.
(3) Voluntary social insurance includes the following policies:
- Maternity allowance;
- Retirement;
- Death benefits;
- Work injury insurance as prescribed by the Law on Occupational Safety and Health.
(4) Unemployment insurance as prescribed by the Law on Employment.
(5) Supplementary retirement insurance.
What are the principles of social insurance in Vietnam?
According to Article 5 of the Social Insurance Law 2024, the principles of social insurance are defined as follows:
- The level of compulsory and voluntary social insurance benefits is calculated based on the level of contributions and the duration of social insurance contributions; there is sharing among social insurance participants as stipulated by the Social Insurance Law 2024.
- The level of compulsory social insurance contributions is calculated based on the salary used as the basis for compulsory social insurance contributions. The level of voluntary social insurance contributions is calculated based on the income used as the basis for voluntary social insurance contributions chosen by the participant.
- Individuals with periods of compulsory and voluntary social insurance contributions are entitled to monthly benefits, pension, and death benefits based on the periods of compulsory and voluntary social insurance contributions.
- The periods of social insurance contributions already used for one-time social insurance benefits are not included in the periods used as the basis for calculating social insurance benefits.
- The social insurance fund is centrally managed, unified, transparent, and used for the correct purposes, being accounted for separately in component funds, groups of objects implementing salary policies set by the State, and wage policies decided by employers.
- The implementation of social insurance must be simple, easy, and convenient, ensuring the prompt and complete rights and benefits of participants and beneficiaries of social insurance benefits.
- The minimum period of social insurance contributions to determine eligibility for retirement and monthly death benefits is counted by year, with each year consisting of 12 months. For cases of uneven months of contributions, 01-06 months are counted as half a year, and 07-11 months are counted as one year.
- The settlement of social insurance benefits is determined according to the social insurance law at the time of enjoying the social insurance benefits.
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