A method and apparatus for video encoding or decoding performed by a video encoder or a video decoder incorporating advanced multiple transform (AMT) are disclosed. According to this method receives input data associated with a current block, wherein the input data corresponds to a current coefficient block to be processed by an inverse transform process, and determines a default transform type and a single transform set consisting of two transform types. The method then selects a vertical transform and a horizontal transform from the default transform type or the single transform set based on at least a transform selection flag, wherein the transform selection flag is decoded after decoding transform coefficients of the current block, and recovers the current block according to the current coefficient block, a vertical inverse transform associated with the vertical transform and a horizontal inverse transform associated with the horizontal transform.