Law on Tax Administration 2025 No. 108/2025/QH15 dated 10 December 2025 (“LOTA 2025”)
The LOTA 2025, effective from 1 July 2026, aims to digitize and modernize tax administration in the era of digital economy and international integration, with several noteworthy provisions as follows:
First and foremost, the LOTA 2025 expands the scope of tax subjects to include digital platforms. Specifically, foreign individuals and organizations earning income in Vietnam or conducting business through e-commerce platforms or other digital platforms are also subject to tax administration.[1] At the same time, operators of digital technology platforms that have online ordering and payment functions are responsible for withholding tax, filing tax returns and paying tax on behalf of individuals and household businesses operating on their platforms.[2] This provision aims to cover revenue derived from the digital economy and limit losses to the state budget from revenue generated by cross-border transactions in the current era of international integration.
To facilitate the above changes, improve tax administration efficiency, and increase tax collection transparency from online business activities, the LOTA 2025 encourages the application of technology by requiring the tax administration information system to automatically generate tax declarations, offset overpaid amounts, process tax refunds, and apply tax exemptions/reductions;[3] taxpayers must make payments using the identification code of the payable amount (where available), and ensure electronic connectivity with the tax authority.[4] Tax examinations prioritize online and remote methods, apply risk-based management, and avoid overlap with state inspections and audits.[5] This is one of the provisions that gives concrete effect to the shift from pre-inspection to post-inspection in tax administration, thereby shortening the time required to process procedures, ensuring transparency, and reducing errors.
In particular, the LOTA 2025 strengthens public participation in tax administration by clearly stipulating prohibited acts in tax administration, such as colluding, conniving, or covering up transfer-pricing practices and tax evasion, etc.[6] At the same time, the LOTA 2025 introduces mechanisms to encourage consumers to obtain invoices and to reward consumers who report acts of failing to issue e-invoices.[7]
The LOTA 2025 enhances procedures for handling non-compliance with tax obligations. Notably, it requires those who are the beneficial owners of enterprises that are subject to implementation of a tax administrative decision but have not yet paid the applicable taxes to do so before departing the country. This is intended to complete the tax debt recovery mechanism and ensure the state budget.[8]
Law on Personal Income Tax 2025 No. 109/2025/QH15 dated 10 December 2025 (“Law on PIT 2025”), amended and supplemented by Law No. 09/2026/QH16 dated 24 April 2026 (“Law No. 09”)
The Law on PIT 2025, effective from 01 July 2026 and having been amended and supplemented by Law No. 09, introduces major reforms and preferential policies to attract high-tech workers. These changes not only directly affect employees but also promote the development of the domestic investment market. It should be noted that the provisions on income from business activities, salaries, and wages of resident individuals apply from the 2026 tax year.[9]
Notably, the Law expands the scope of income subject to personal income tax (“PIT”) to include income from the transfer of gold bullion, as well as from e-commerce and digital-platform business activities, among others.[10] Accordingly, PIT is calculated at 0.1% of the transfer price.[11] The addition of these provisions clearly demonstrates that the regulatory mechanism is becoming increasingly stringent, with a view to ensuring balance among different investment channels.
Alongside the expansion of the taxable income scope, the Law also expands the categories of income eligible for tax exemption and reduction in order to develop a high-quality workforce and promote long-term investment capital. These include, for example, a five-year tax exemption for high-tech human resources and high-quality digital technology industry personnel who satisfy the statutory conditions;[12] tax exemption for income from the transfer of open-ended fund certificates held for at least 02 (two) years; and a 50% tax reduction on returns from certain investment funds.[13]
In addition, the Law continues to implement the policy of developing the private sector by officially introducing a mechanism for determining PIT based on the income-declaration method. The Government is authorized to prescribe the revenue threshold below which PIT is exempt;[14] once this threshold is exceeded, tax rates of 15%, 17%, and 20% will apply successively to taxable income (calculated as revenue minus related expenses). In addition, business individuals with annual revenue of up to VND 03 billion may still choose to directly declare and pay tax based on revenue multiplied by the tax rate applicable to the relevant type of business. Individuals leasing out real estate, except for accommodation businesses, are subject to a fixed tax rate of 05% on the portion of revenue exceeding the prescribed threshold. [15]
Next, the Law adjusts deductible amounts to better reflect socio-economic welfare conditions. It adds cases in which deductions may be made from taxable income for medical, education, and training expenses incurred for the taxpayer and their dependants; [16] meanwhile, circumstance-based deductions are maintained at (i) VND 15.5 million per month for the taxpayer and (ii) VND 6.2 million per month for each dependant. [17]
In addition, attention should be paid to the new progressive tax schedule applicable to income from salaries and wages: [18]
| Bracket | Taxable income per year (million VND) | Taxable income per month (million VND) | Tax rate (%) |
| 1 | Up to 120 | Up to 10 | 5 |
| 2 | Exceeding 120 up to 360 | Exceeding 10 up to 30 | 10 |
| 3 | Exceeding 360 up to 720 | Exceeding 30 up to 60 | 20 |
| 4 | Exceeding 720 up to 1,200 | Exceeding 60 up to 100 | 30 |
| 5 | Exceeding 1,200 | Exceeding 100 | 35 |
The new provisions of the Law on PIT are expected to contribute to economic development in the new era as well as contributing to the improvement of people’s living standards in various respects. However, not only individuals and employees, but also enterprises and investors should review their sources of income, update their personnel policies – particularly those concerning positions classified as high-quality digital technology industry personnel, reassess investment portfolios, and monitor detailed implementing guidance to ensure correct and timely compliance.
[1] Point b and c Clause 1 Article 2 of LOTA 2025
[2] Point a Clause 4 Article 13 of LOTA 2025
[3] Point b Clause 1 Article 13, Clause 2 Article 15, Clause 4 Article 18, Clause 3 Article 19 of LOTA 2025
[4] Point c and k Clause 2 Article 37 of LOTA 2025
[5] Point a and d Clause 1 Article 22 of LOTA 2025
[6] Article 8 of LOTA 2025
[7] Point g Clause 5, Clause 7 Article 26 of LOTA 2025
[8] Article 17 of LOTA 2025
[9] Clause 1 and 2 Article 29 of LOTA 2025
[10] Article 3 of the Law on PIT 2025
[11] Article 19 of the Law on PIT 2025
[12] Clause 2 and 3 Article 5 of the Law on PIT 2025
[13] Clause 4 and 5 Article 5 of the Law on PIT 2025
[14] Clause 1 Article 7 of the Law on PIT 2025, amended by Article 1 of Law No. 09
[15] Clause 2, 3 and 4 Article 7 of the Law on PIT 2025
[16] Clause 2 Article 11 of the Law on PIT 2025
[17] Clause 1 Article 10 of the Law on PIT 2025
[18] Article 9 of the Law on PIT 2025
