Vietnam Implements Significant Tax Reforms to Foster Equity in Taxation

Vietnam’s new tax reforms, effective July 1, aim to modernize the system, enhance compliance, and promote economic fairness.

Non-cash payments now required for all VAT input deductions, even for transactions below VNĐ20 million, to curb fake invoices and enhance financial transparency among businesses and vendors.
Threshold for VAT liability doubled to VNĐ200 million annually from 2026, easing compliance and reducing tax burdens for household and micro businesses, supporting reinvestment and formal growth.
Expanded VAT exemptions and adjustments include updated taxable goods, revised import VAT calculations, and exemptions for donated goods and specific sectors to align with economic value and policy goals.
E-commerce platforms must withhold VAT and personal income tax at source from sellers’ revenue, ensuring fair tax enforcement across digital transactions and aligning online sellers with traditional tax obligations.