Private economy on the way of revitalization

Since Resolution No. 68-NQ/TW was issued in May by the Politburo on the development of Vietnam’s private economic sector, what impact has it had on the business community?

Politburo Resolution No. 68 sets ambitious targets for the private economy, aiming for 2 million operating enterprises by 2030, or about 20 enterprises per 1,000 people. At least 20 large enterprises are expected to join global value chains, with the private economy growing 10-12 per cent annually, contributing 55-58 per cent of GDP, and providing employment for 84-85 per cent of the workforce. By 2045, the goal is at least 3 million enterprises, contributing over 60 per cent of GDP, with high regional and international competitiveness.

To achieve this, the Resolution focuses on improving the investment and business environment, simplifying administrative procedures, reducing compliance costs, and strengthening support for the private sector to grow and contribute significantly to GDP.

Since its issuance in May 2025, Politburo Resolution No. 68 has revitalized the entrepreneurial spirit and boosted business confidence. In the first ten months of this year, 255,800 new and reactivated enterprises were recorded, for a 26.5 per cent increase over the same period of 2024, and exceeding the number of enterprises exiting the market by 34 per cent. Private sector capital contributions stood at nearly VND5,200 trillion ($200 billion), up 98.2 per cent year-on-year, with over 1 million enterprises operating nationwide as of October 31.

From May to September, an average of over 12,000 enterprises resumed operations each month, bringing the total to nearly 93,000 in the first ten months of 2025, up more than 40 per cent year-on-year. Overall, the average monthly number of enterprises entering or re-entering the market grew to nearly 32,000, a 28.4 per cent increase over the first four months of the year (24,900 per month).

The business environment has also improved, reflected in positive feedback from the business community. A survey by the Private Sector Development Research Board (Board IV) found that over 46 per cent of enterprises “expect / strongly expect” positive outcomes from Politburo Resolution No. 68; the highest score among business confidence indicators.

To reach the 2 million enterprise target by 2030, the MoF continues to coordinate with relevant agencies to complete the legal framework and ensure a favorable, transparent, and equal business environment. Barriers to market entry and compliance costs are being addressed through substantial cuts in administrative procedures and reforms to business conditions.

As of the end of October, the Prime Minister had approved the elimination of 348 administrative procedures, simplified 1,703 others, and cut 2,041 business conditions at all 14 ministries and agencies. Ministries and agencies also amended or submitted for approval 172 administrative procedures, simplified 718 others, and cut 222 business conditions.

Under the approved plan, a total of 2,941 administrative procedures related to production and business are expected to be cut or simplified (60.2 per cent), and 2,263 business conditions in regulated industries removed (31 per cent). This is projected to save 13,182 days in administrative processing and reduce compliance costs by over VND34.2 trillion ($1.3 billion) a year, or nearly 29 per cent.

Household businesses are key to reaching 2 million enterprises by 2030. What factors encourage them to convert to enterprise models?

There are currently about 5.2 million household businesses nationwide, representing a vast area of potential to reach the enterprise development target. Even if only a small proportion convert to enterprise models, the goal of 2 million enterprises is entirely feasible.

In reality, however, many household businesses are still hesitant to convert, which I see as having three main reasons. First, compliance costs between household businesses and enterprises are still relatively high; second, household businesses are not fully familiar with enterprise regulations or accounting management, causing reluctance; and third, household businesses are subject to a simplified tax regime, with simpler accounting, invoices, and documentation compared to enterprises.

To remove such barriers, Politburo Resolution No. 68 sets an important guideline: from 2026, the lump-sum tax will be abolished, moving towards transparency for household businesses and encouraging conversion. Upon becoming enterprises, they will enjoy multiple incentives and support, such as preferential access to credit, land, training, technology, and tax incentives in accordance with National Assembly Resolution No. 198.

The MoF has completed a draft decree guiding Resolution No. 198 for government review and approval. It is expected that once the decree is issued, support policies for newly-established enterprises and household business conversions will positively impact this transition.

What specific steps has the MoF taken to help household businesses confidently convert into enterprises?

The Ministry has focused on two main groups of solutions: improving the legal and policy framework, and implementing practical support measures.

It is now studying amendments to the Law on Tax Administration and the Law on Personal Income Tax towards establishing a new management model - simple, transparent, and easy-to-implement declarations,  and simplifying accounting, invoices, and documentation to ensure household businesses are not overly burdened during conversion. It is also researching the development of a Law on Individual Business to minimize management and financial-accounting gaps between household businesses and enterprises.

To ensure coordinated implementation, the Ministry is upgrading technical infrastructure to implement the abolition of the lump-sum tax on household businesses from January 1, 2026; strengthening digital transformation in tax administration by applying electronic invoices generated from cash registers to ensure correct and full tax collections, reducing time and costs for household businesses; providing free electronic tax filing and payment systems, invoice software, and accounting software, prioritizing support for struggling businesses during the early stages; and accelerating internal digital transformation to improve public service quality and tax management capacity, with enhanced data connectivity.

Raising awareness and building management capacity at household businesses have also been emphasized by the MoF and the General Department of Taxation. Tax authorities have provided hands-on guidance on electronic invoicing, tax declarations, and accounting software use. The Ministry is also reforming inspection and supervision online, based on risk classification, reducing pressure, increasing transparency, and creating a more business-friendly environment.

How is the Ministry helping small and medium-sized enterprises (SMEs) and innovative enterprises overcome resource constraints?

The main obstacles currently facing the private sector are access to capital, land, technology, and high-quality human resources. As an advisory body to the government on finance and budget and a supporter of businesses and household enterprises, the Ministry of Finance plans to implement several key measures to help SMEs and innovative enterprises improve resource access.

First, reforming tax and fiscal policies to incentivize SMEs and innovative enterprises; proposing suitable corporate income tax incentives for income invested in research and development (R&D) and innovation; waiving or reducing certain fees for tech startups; and applying rapid deduction and tax refund mechanisms for enterprises with innovative projects.

Second, effectively operating the SME Development Fund through the research and improvement of State financial funds outside the budget (credit guarantee funds, SME development funds, local development investment funds, etc.) to build a model that meets State management requirements and private sector needs, particularly for SMEs and innovative enterprises.

Third, increasing land access. The MoF will actively coordinate with other ministries, sectors, and localities to review and facilitate land leasing for enterprises, utilizing surplus public assets transparently; and accelerate the implementation of Resolution No. 198 to allow SMEs, innovative enterprises, and support industries to access industrial land plots and clusters.

Additionally, the Ministry promotes digital transformation, management and finance-tax training, and coordination with business associations to help enterprises understand and promptly utilize support policies.

What are the key priorities in achieving enterprise development goals under Politburo Resolution No. 68?

I believe there are three main tasks to focus on in the time ahead.

First, continue improving the legal and policy framework for enterprise support under the direction of the Politburo in Resolution No. 68 and the National Assembly in Resolution No. 198, quickly putting policies into practice to improve the business environment; support access to land and production sites, financial and credit assistance, public procurement, science, technology, innovation, digital transformation, and workforce training; and support the establishment of medium and large enterprises, encouraging enterprises to enhance competitiveness.

Second, continue reducing costs and simplifying administrative procedures to create a favorable, transparent, and efficient business environment. The Ministry focuses on digital transformation in taxation, customs, and treasury, aiming for 100 per cent Level-4 online public services. This helps enterprises save time and cost while improving transparency in government management. In addition, it focuses on removing market entry and operational barriers, cutting administrative procedures, reducing compliance costs, and reforming business conditions.

Third, foster and spread confidence and the entrepreneurial spirit in society. The Ministry always identifies enterprise support as not just policy issuance but as a process of accompanying businesses, listening, sharing, solving problems, and creating policies that enable growth.

With a series of coordinated solutions, from institutions and policies to practical implementation, the MoF is gradually removing bottlenecks, creating new momentum for enterprises, helping the private sector become the most important driver of the national economy, pioneering science, technology, innovation, and digital transformation, driving growth, creating jobs, improving workplace productivity, and enhancing national competitiveness in a new era of prosperity, strength, civilization, and happiness for the nation.