Summary of tax regulations effective from July 1, 2025

Vietnam will officially implement a series of major tax policy changes starting from July 1, 2025, based on the 2024 VAT Law, new decrees, circulars, and a resolution passed by the National Assembly:

1. VAT reduced from 10% to 8% until end of 2026

• According to Resolution 204/2025/QH15 and Decree 174/2025/ND-CP, the VAT rate will be reduced by 2% (from 10% to 8%) from July 1, 2025 to December 31, 2026.
• Applies to services such as transportation, logistics, IT - excluding sectors like telecommunications, finance, real estate, insurance, securities, metal products, etc.

2. 2024 VAT law officially takes effect

• The list of goods/services exempt from VAT has been updated. Fertilizers, agricultural machinery, offshore fishing vessels, etc., have been removed, while new items like relief goods and national artifacts have been added.
• New provision for VAT refund when uncredited input VAT is ≥ VND 300 million/year.
• Expanded scope of 0% VAT for international transportation, export services via agents, overseas construction, etc.
• Official recognition that promotional items are taxable at VND 0 per the Commercial Law and GST 2024.
• Cashless payment is mandatory for invoices ≥ VND 20 million to claim input VAT deduction.

3. Personal tax codes replaced with citizen identification numbers (CCCD)

• From July 1, 2025, 12-digit CCCDs will replace personal tax codes for individuals, household businesses, and sole proprietorships.
• Businesses must update CCCD numbers in tax declaration software, e-invoices, and tax reports.

4. E-commerce platforms with payment functions must declare and pay taxes on behalf of sellers

• Under Decree 117/2025/ND-CP, e-commerce platforms with e-wallets or built-in payment features must declare and pay VAT and PIT on behalf of individual or household sellers starting July 1, 2025.
• Platforms without integrated payments: Sellers must self-declare and pay taxes on their business income.

5. Other tax management and digital transformation provisions

• Decentralized tax enforcement: Commune-level People’s Committee Chairpersons are now authorized to issue tax enforcement decisions under Decree 125/2025/ND-CP.
• New digital identity accounts for organizations: Starting July 1, 2025, organizational digital identity accounts issued by the Ministry of Public Security will replace national public service accounts, according to Decree 69/2024/ND-CP.

Practical recommendations for businesses

Starting July 1, 2025, businesses and household enterprises should promptly update themselves on the 2024 VAT Law and related decrees to correctly implement new regulations on tax reduction, declaration, refund, and e-payment. Timely compliance will not only ensure legal adherence but also help businesses leverage tax incentives to enhance competitiveness and operational efficiency.

If you need in-depth consultation or support in transitioning your accounting, invoicing, and tax systems, Zora Consulting is ready to assist you.