Compliance Timeline
Upcoming regulatory effective dates and compliance deadlines
January 2026
Administrative Penalties for Tax and Invoice Violations in Vietnam
Decree 310/2025/ND-CP, effective January 16, 2026, replaces Decree 125/2020/ND-CP and introduces significant changes to administrative penalties for tax and invoice violations in Vietnam. The scope of violations has expanded to include land use fees, land and water surface rental fees, fees for granting mineral and water resource exploitation rights, after-tax profits of state-owned enterprises, and dividends from state capital in joint-stock and limited liability companies. For the first time, the decree recognizes force majeure exemptions (natural disasters, epidemics, fires, wars) from penalties if taxpayers demonstrate they took all preventive measures. Crucially, penalty liability now extends to third parties: authorized agents and organizations/individuals performing tax obligations on behalf of taxpayers will be held directly responsible for violations. This has major implications for businesses outsourcing tax compliance and accounting services. Invoice-related penalties are now structured in detailed tiers based on the number of invoices and their purpose (sales versus promotions/gifts/internal use). Fines range from VND 500,000 to VND 80 million depending on violation severity. Businesses must review their invoicing processes, especially for e-invoices, and ensure authorized representatives maintain full compliance to avoid serious legal and financial risks under this strengthened enforcement framework.
Understanding Key Indirect and International Taxes in Vietnam
Vietnam's tax system imposes various indirect and international taxes that significantly impact business operations. Companies must understand regulations regarding Value Added Tax (VAT), Special Consumption Tax (SCT), import/export duties, and international tax issues such as transfer pricing. VAT has three rates: 0%, 5%, and 10% depending on goods and services categories, with a 2% reduction for items subject to 10% VAT until December 31, 2026. Special Consumption Tax applies to luxury or non-essential goods like alcohol, beer, and tobacco, with the 2025 SCT Law effective from January 1, 2026, aiming to guide healthier lifestyles. Import duties have three tiers: preferential rates (MFN), special preferential rates (under FTAs), and ordinary rates (70% higher than preferential rates). Export duties apply only to certain natural resources with rates ranging from 0-40%. Regarding international taxes, enterprises engaging in related-party transactions must comply with transfer pricing regulations, where tax authorities assess the economic substance of transactions rather than their legal form. Foreign investors should carefully consider this substance-over-form principle when designing supply chains and operating structures in Vietnam to ensure compliance and optimize tax planning.
Preparing for Vietnam's Special Consumption Tax Changes in 2026: Key Compliance Highlights
Effective January 1, 2026, Vietnam's revised Special Consumption Tax (SCT) framework represents a significant shift in taxing health-sensitive goods, environmentally impactful products, and selected services. Anchored by the 2025 SCT Law and clarified through Decree 360/2025/ND-CP and Circular 158/2025/TT-BTC, the new regime expands the scope of taxable items, refines exemptions, and introduces dual tax calculation methods with direct implications for manufacturers, importers, and service providers. The law aims to influence consumer behavior toward healthier choices, including reducing tobacco use, alcohol and beer consumption, and sugar intake, while strengthening enforcement against smuggling and counterfeit goods. The expanded taxable goods list now includes cigarettes, alcohol, beer, vehicles under 24 seats, motorcycles over 125cc, aircraft, air conditioners (24,000-90,000 BTU), playing cards, votive paper, and soft drinks with sugar content over 5g/100ml. Taxable services include nightclub, karaoke, massage, casino, electronic games with prizes, betting, golf, and lottery businesses. The law also clarifies non-taxable objects and introduces new compliance procedures. SMEs need to prepare proactively for these changes, particularly manufacturers, importers, and service providers in affected sectors. Understanding the new taxable categories, tax rates, and exemption provisions will help businesses maintain compliance and avoid legal risks when the law takes effect. The reform also supports green industry development, environmental protection, and tax administration modernization through a more transparent and streamlined framework.
Vietnam Abolishes Business License Tax from 2026
Effective January 1, 2026, Vietnam has officially abolished the business license tax (BLT) as part of regulatory reforms to reduce compliance costs and promote private-sector growth. Previously, enterprises paid VND 2-3 million (US$80-120) annually, while household businesses paid VND 300,000 to VND 1 million (US$12-40), regardless of profitability. This change is mandated by Resolution No. 198/2025/QH15 on special mechanisms and policies to promote private-sector development and Decree No. 362/2025/ND-CP, which repeals the previous framework under Decree No. 139/2016/ND-CP. Official Letter No. 645/CT-CS issued by the Taxation Department on January 24, 2026, directs provincial tax authorities to implement the new rules uniformly. From 2026 onward, all enterprises, cooperatives, public service units engaged in business, household businesses, and individual operators are exempt from paying BLT and filing related declarations. However, tax authorities will continue collecting outstanding BLT for 2025 and prior years. This abolition particularly benefits micro, small, and medium-sized enterprises by allowing them to retain more working capital and reducing administrative procedures, contributing to a more streamlined business environment.