Knowledge base

The Ho Chi Minh City Tax Sub-department 2 advised that soft skills training in digital marketing and business management (industry code 8559) is VAT-exempt if it qualifies as "teaching and vocational training activities as regulated by the law on education and vocational education" under Article 5.13 of VAT Law 48/2024/QH15 and Article 4.7 of Decree 181/2025/ND-CP. Soft skills training centers may qualify as an "other center performing continuing education tasks" under Article 42.2 of Decree 125/2024/ND-CP (covering centers for knowledge enrichment, life skills, and workplace capacity building), or as a "vocational education institution" under Vocational Education Law 74/2014/QH13 - requiring the relevant registration certificate in either case. If the activity does not meet these conditions, the service is subject to 10% VAT (no preferential rate of 0%, 5%, or 8% applies). Businesses must self-assess against their actual circumstances and applicable law, bearing responsibility for accuracy under Article 17.2 of Tax Administration Law 38/2019/QH14.

Decree 254/2025/ND-CP, issued by the Government on September 26, 2025, provides detailed regulations on the management, payment, and financial settlement of projects using public investment capital. This decree establishes clear procedures for disbursement, payment, and settlement of state budget capital for public investment projects, aiming to ensure transparency, efficiency, and accountability in public financial management. For SMEs participating in providing services, construction work, or supplying goods for public investment projects, this decree directly impacts contract payment and settlement procedures. Businesses need to understand documentation requirements, payment submission deadlines, and their responsibilities in providing valid supporting documents to receive timely payments. The decree also clearly defines the responsibilities of all parties involved in the payment and settlement process, helping to minimize payment delay risks. Understanding these regulations helps SMEs prepare accurate documentation and comply with proper procedures, thereby ensuring stable cash flow when participating in public projects. The decree takes effect immediately from the date of issuance, so businesses currently executing contracts with public investment projects need to review their internal processes to ensure compliance.

The National Assembly Office has issued Consolidated Text No. 114/VBHN-VPQH, merging the full Law on Value Added Tax (VAT) No. 48/2024/QH15 (effective July 1, 2025) with three subsequent amendments: Law No. 90/2025/QH15, Law No. 149/2025/QH15 (effective January 1, 2026), and Law No. 09/2026/QH16 (effective April 24, 2026). This is the complete, up-to-date version of the VAT Law that businesses, accountants, and household businesses should use for reference instead of the original 2024 text. Main content covers: the scope of taxable objects and 28 categories of goods and services exempt from VAT (unprocessed farm produce, life insurance, medical services, textbooks, software, land-use-right transfers, and more); three tax rates of 0 percent, 5 percent, and 10 percent; two tax calculation methods (the credit method and the direct-on-revenue method); conditions for input VAT deduction and refund; and prohibited acts related to invoices and documentation. Key points for SME owners and household businesses: the annual revenue threshold below which household and individual businesses are exempt from VAT (Article 5, Clause 25) has been amended twice and is now set by the Government for each period; e-commerce platforms and digital platforms with payment functions must withhold, declare, and pay VAT on behalf of household and individual sellers using the platform; foreign suppliers selling goods or digital services through e-commerce channels to customers in Vietnam are subject to the 10 percent rate. The refund threshold for un-deducted input VAT is 300 million VND for exports and investment projects. Because this is a consolidated text rather than a new law, its provisions took effect on the dates listed above at different times; businesses should match each clause to its corresponding effective date when applying it.

Tax Sub-department No. 10 of Dong Nai province clarifies the VAT treatment for cashew shell residue (a by-product recovered when pressing oil from cashew shells). From 1 July 2025 to 31 December 2025: enterprises and cooperatives using the VAT credit method that sell cashew shell residue to other enterprises or cooperatives must apply the standard VAT rate of 10%. From 1 January 2026 (when Law No. 149/2025/QH15 takes effect): enterprises and cooperatives using the VAT credit method that sell cashew shell residue to other enterprises or cooperatives are NOT required to declare or pay VAT on these sales.

The Ministry of Finance (through Can Tho City Tax Department) confirmed that self-manufactured tools such as scaffolding frames, diagonal braces, and similar equipment produced by a construction company and transferred to project sites for construction use qualify as internal goods in circulation to continue the production process. Under Clause 1, Article 6 of Decree 181/2025/ND-CP, such goods are excluded from VAT liability. The tax authority confirmed that the company is not required to issue an invoice and is not required to declare or pay VAT on the internal transfer of these self-manufactured tools. Earlier audit positions requiring invoice issuance (even without VAT) were found inconsistent with the applicable regulations.

The Ministry of Finance provides guidance on VAT treatment of wood and wood products effective 1 July 2025 under VAT Law 48/2024/QH15 and Decree 181/2025/ND-CP. The key point: wood is explicitly excluded from the 5% VAT group applicable to minimally processed agricultural and forestry products; processed wood and commercially traded wood is subject to 10% VAT. Specifically: self-produced minimally processed forestry products sold by the producer are VAT-exempt. However, wood (even minimally processed) does **not qualify for the 5% rate** because the new law explicitly excludes wood from that category. Commercially traded or further-processed wood products attract **10% VAT**. On 13 April 2026 the Ministry of Finance issued Official Letter 4582/BTC-CST providing detailed guidance on VAT treatment of minimally processed wood to provincial and city tax departments.

The General Department of Customs responded to a company's inquiry about the 2026 VAT rate for imported goods under HS code 8517.62.43 (land mobile information terminal equipment). Under Decree 174/2025/ND-CP dated 23 June 2025, the VAT reduction policy applies from 1 July 2025 through 31 December 2026, but telecommunications sector goods are explicitly excluded from the reduction. The Customs authority did not confirm a specific tax rate in the reply, instead directing the business to review Decree 174/2025/ND-CP and Official Letter 20215/CHQ-NVTHQ dated 20 August 2025 for implementation guidance. For further clarification, the company should contact the customs office where their customs declaration is registered.

The Phu Tho Tax Authority provides guidance to a company manufacturing stainless steel boilers and furniture (primary industry code 2511) on the applicable VAT rate under Decree No. 174/2025/ND-CP. Decree No. 174/2025/ND-CP dated 30 June 2025 reduces VAT from 10% to 8% for all goods and services currently subject to the 10% rate, except for categories listed in Appendix I and Appendix II. While "metal products" (san pham kim loai) are generally among the excluded categories, the actual classification depends on the official product industry nomenclature. Referencing Decision No. 43/2018/QD-TTg dated 01 November 2018 (Vietnam Product Industry Classification System), industry code 2511 is classified as "Cau kien kim loai" (metal structural components/fabricated metal products). This specific sub-category is NOT included in Appendix I or Appendix II of Decree No. 174/2025/ND-CP. Therefore, metal structural components (code 2511) are eligible for the reduced 8% VAT rate. The company should verify its actual products and supporting documentation to confirm eligibility for the VAT reduction as stipulated.

VAT on air ducts, air duct accessories and fire-resistant air ducts is not a flat figure: goods currently taxed at 10% are reduced to 8% (1 July 2025 - 31 December 2026) under Decree 174/2025/ND-CP, but products classified as "metal products" under Appendix I remain at 10%. The tax authority does not assign a rate; businesses must self-determine by cross-referencing the Vietnam Product Classification System (Decision 43/2018/QD-TTg).