On the afternoon of Aug. 24, Vietnam’s National Assembly passed a resolution cutting personal and corporate income taxes for individuals and businesses, with 480 of the 481 lawmakers present voting in favor. The resolution takes effect immediately.
 

The National Assembly approved a 30% reduction in personal income tax payable for the 2026 and 2027 tax years on business income earned by resident individuals with annual revenue of no more than VND10 billion ($380,000) in each of those years.

It also approved a 30% reduction in corporate income tax payable for the 2026 and 2027 tax years for businesses and organizations established under Vietnamese law with annual revenue of no more than VND10 billion ($380,000) in each year. The reduction excludes businesses formed through corporate divisions or separations after the resolution takes effect if the combined revenue of the resulting businesses exceeds VND10 billion in 2026 or 2027.

For businesses already receiving tax incentives under the Corporate Income Tax Law or other laws and resolutions of the National Assembly, the reduction stipulated in the resolution will be calculated on the corporate income tax payable after existing incentives have been deducted.

The resolution takes effect today and applies to the 2026 and 2027 tax years.

Before the National Assembly voted, Finance Minister Ngo Van Tuan presented a report explaining the draft resolution and revisions made in response to lawmakers’ feedback.

The government said surveys conducted by several organizations, including the Vietnam Chamber of Commerce and Industry (VCCI), the Vietnam Association of Small and Medium Enterprises, and the Private Economic Development Research Board (Board IV), showed that household businesses, individual entrepreneurs and enterprises with very small revenue are currently facing the greatest difficulties and have limited resilience, making them particularly in need of support.

These groups account for a large proportion of the households, individuals and businesses currently operating in Vietnam, in line with the policy’s objective of directing assistance toward those facing the greatest difficulties rather than introducing broad-based tax cuts.

The tax reduction is designed to target household businesses, individual entrepreneurs and enterprises with relatively low revenue, which have been among the hardest hit and are most in need of support.

The measure has been calculated to remain within the capacity of the state budget. While it may reduce state budget revenue in the short term, the government expects it to help sustain revenue sources over the longer term while allowing beneficiaries to retain more profits for reinvestment, production expansion and productivity improvements.

A number of lawmakers called for further clarification to ensure the policy delivers meaningful benefits, wins taxpayers’ support and directs resources to the intended recipients. They also sought greater clarity over the actual level of assistance, fairness between different tax calculation methods and the rationale behind the VND10 billion ($380,000) annual revenue threshold.

In response, the government said annual revenue of VND10 billion is equivalent to around VND833 million ($31,700) a month. Assuming a profit margin of 12%, monthly profit would be about 12% of VND833 million, or approximately VND100 million ($3,800). After tax, monthly income would stand at around VND83-85 million ($3,150-$3,230).

With an average of five people working in a household business, individual business or small enterprise, income would amount to around VND17 million ($650) per person per month. The government considers this level reasonable in relation to current living standards.

The tax reduction is intended to provide targeted support for household businesses, individual entrepreneurs and enterprises with relatively low revenue, which have been among the most affected and most in need of assistance. It is also expected to contribute to government priorities including innovation, digital transformation, the green economy, development in disadvantaged economic regions and higher labor productivity.

During the National Assembly’s discussion on Aug. 22, Finance Minister Ngo Van Tuan said Ministry of Finance statistics showed that 2.69 million household businesses have annual revenue below VND10 billion, accounting for 99.98% of all household businesses nationwide.

More than 865,000 companies have annual revenue below VND10 billion, representing around 81.1% of all businesses.

Based on 2025 tax revenue, implementation of the tax reduction is expected to cut state budget revenue by around VND3.191 trillion ($121 million) in 2026 and VND3.51 trillion ($133 million) in 2027.

Crypto-asset services added to anti-money laundering framework

Also on Tuesday afternoon, the National Assembly voted to pass legislation amending and supplementing provisions of the Law on the State Bank of Vietnam, the Law on Prevention and Combat of Money Laundering, and the Law on Credit Institutions.

The National Assembly agreed to bring “crypto-asset services” within the scope of anti-money laundering regulations. Reporting entities will be required to notify the State Bank of Vietnam of suspicious transactions when there are reasonable grounds to suspect that assets involved in a transaction are proceeds of crime.

Notably, the law specifies 15 suspicious indicators in the crypto-asset sector that require monitoring.

The new legislation also sets out the responsibilities of the Government Inspectorate, the Ministry of Finance and other ministries and agencies in anti-money laundering activities, as well as principles for risk-based inspection, examination and supervision of anti-money laundering compliance.

Under the law, the Government Inspectorate is responsible for inspecting anti-money laundering activities of reporting entities operating in sectors overseen by ministries that do not have their own ministerial inspectorates, except where inspection falls under the responsibility of the Ministry of Finance.

The Ministry of Finance is responsible for inspecting anti-money laundering activities of reporting entities in the crypto-asset sector when assigned by the government, as well as those operating in the securities sector.

Tran Thuong