On May 17, 2025, the National Assembly of Vietnam passed Resolution No. 198/2025/QH15 on certain special mechanisms and policies aimed at promoting the development of the private economy, with a particular focus on tax exemption policies.
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Under Resolution No. 198/2025/QH15, new policies on taxes, fees, and charges to promote private sector economic development are outlined as follows:
(1) Corporate Income Tax Exemption shall be exempted for 2 years and reduced by 50% in payable tax for the subsequent four years for income derived from innovative startup activities of innovative start-up enterprises, venture capital fund management companies, and intermediary organizations supporting innovation and start-ups. The period of exemption and reduction shall be determined in accordance with the Law on Corporate Income Tax.
(2) Exemption from Personal Income Tax and Corporate Income Tax on income derived from the transfer of shares, capital contributions, rights to contribute capital, rights to purchase shares or capital contributions in innovative start-up enterprises.
(3) Exemption from Personal Income Tax for 2 years and 50% reduction in payable tax for the subsequent four years for income from wages and salaries received by experts and scientists working for innovative start-ups, R&D centers, innovation hubs, and intermediary organizations supporting start-ups.
(4) Full Corporate Income Tax exemption for small and medium-sized enterprises for 3 years from the date of issuance of the initial Enterprise Registration Certificate.
(5) Training and retraining costs incurred by large enterprises for small and medium-sized enterprises participating in their supply chains shall be considered deductible expenses for the purpose of determining taxable income under the Corporate Income Tax Law.
(6) From January 1, 2026, household businesses and individual business households shall no longer apply the lump-sum taxation method. Instead, they must comply with the provisions of the Law on Tax Administration.
(7) Abolition of business license fees from January 1, 2026.
(8) Exemption from fees and charges for organizations, individuals, and enterprises in cases of reissuance or replacement of administrative documents due to the restructuring of state administrative agencies, as provided by law.
Resolution No. 198/2025/QH15 marks an important step forward in improving the institutional and policy framework to unlock the full potential of the private sector economy. These changes not only alleviate financial burdens but also contribute to a transparent, innovation-friendly, and business-enabling environment, thereby fostering sustainable economic development.
Resolution No. 198/2025/QH15 takes effect from May 17, 2025.
=> See more: From March 31, 2025, import tariff rates for multiple commodities will be reduced
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