The Ministry of Finance has issued an express dispatch seeking feedback on a draft National Assembly Resolution regarding personal and corporate income tax reduction policies aimed at supporting household businesses, individual entrepreneurs, and small-scale enterprises.
According to the proposal, household and individual businesses with total annual revenue not exceeding VND10 billion ($381,000) in 2026 and 2027 will be eligible for a 30% reduction in personal income tax (PIT) for each respective year. Similarly, enterprises and organizations operating under Vietnamese law that fall within this revenue threshold will also receive a 30% corporate income tax (CIT) reduction during the tax periods of these two years.
The drafting agency stated that the policy was developed as small-scale businesses and micro-enterprises continue to face significant economic pressure. Previous support measures have included Value Added Tax (VAT) reductions for most goods and services, environmental protection tax adjustments on fuel, non-agricultural land use tax exemptions, and the cutting of 40 types of fees and charges.
With policy space becoming increasingly limited, the continued proposal for a 30% income tax cut is viewed as a direct support measure. This initiative is intended to help businesses retain financial resources for reinvestment, operational expansion, and income improvement.
Previously, Decree No. 41/2026/ND-CP, issued on April 29, 2026, set the revenue threshold for PIT and CIT exemptions at VND1 billion ($38,100) per year, effective from the beginning of 2026.
However, feedback from the business community suggests that the primary challenge is not merely the exemption threshold, but the need to simplify procedures and tax payment methods, while enhancing support measures that align with the practical operations of households and individual entrepreneurs.
A survey conducted by the Vietnam Chamber of Commerce and Industry (VCCI) revealed that nearly 59.3% of household and individual businesses are struggling with high and volatile input costs, while over 43.8% face obstacles in market consumption. Additionally, 32.6% of respondents reported a shortage of capital and human resources—a situation mirrored among micro-sized enterprises.
Alongside the tax reduction proposal, the Government also plans to increase the revenue threshold used to determine simplified tax calculation methods.
Specifically, the revenue limit for households and individual businesses to opt for the revenue-based tax calculation method is proposed to rise from VND3 billion ($114.300) to VND10 billion per year. The revenue cap for enterprises applying this method will be adjusted accordingly to VND10 billion per year to ensure consistency across both the household and corporate sectors.
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