From July 1, 2025, policy2% reduction in value added tax (VAT) rateAccording to Resolution 204/2025/QH15 of the National Assembly, it will officially be applied. This is the next step in the fiscal policy chain to support economic recovery, stimulate consumer demand and reduce the cost burden on businesses after a difficult period.
To realize this resolution,The Ministry of Finance has submitted the 4th Draft Decree (referred to as Draft 4)– The latest document provides specific instructions on subjects, scope of application, reduction levels and implementation methods. Compared to previous drafts (especially Draft 3, which has been mentioned by many media units), Draft 4 has notable adjustments, providing practical updates and clearer support for businesses.
Dự thảo 4 Nghị định giảm thuế GTGT [/caption]One of the biggest differences of Draft 4 isAdding back to the logistics and information technology industry group– two areas that have a major impact on supply chains and digital transformation. This is something that was not present in the previous Draft 3. This shows that the Ministry of Finance has listened to suggestions from the business community and experts to improve the policy in a more realistic direction.
However, the Draft remainskeep the same industry group that does not receive tax reductionsuch as finance - banking, securities, insurance, real estate, mining (except coal) and services subject to special consumption tax (except gasoline).
The 2% VAT reduction policy will apply fromJuly 1, 2025 to December 31, 2026, with:
Enterprises calculate tax using the deduction method: applicable8% level
Enterprises calculate tax according to the ratio of revenue:20% reduction in VAT ratecalculated on revenue.
The draft provides specific instructions on how to record invoices for each tax calculation method, ensuring consistency and ease of implementation. At the same time, attached isNew declaration form, helping businesses be proactive in implementation and limit the risk of future tax audits.
If you are a business owner or in charge of finance and accounting, be proactive:
Review main business linesto determine whether you belong to the tax reduction group;
Prepare invoice software and invoice issuance process in accordance with new regulations
Update the accounting department and internal legal consultingabout the changes that will apply in the second half of 2025 and all of 2026;
Fully archive documents, contracts, and invoicesfor comparison if there is an inspection request from the tax authority.
To help businesses and individuals conveniently research, apply and prepare to deploy new policies, you canDownload the entire content of Draft 4submitted by the Ministry of Finance as follows:
See Draft 4 hereClick to view full version (.pdf file)
Note: This draft is still waiting for official approval by the Government and may have minor adjustments before being promulgated into a Decree.
Reducing VAT is a good opportunity for businesses to reduce costs and increase competitiveness. However, to take advantage effectively, it needs to be done correctly - sufficiently - promptly according to regulations.
DEDICA Law FirmReady to support businesses:
Consulting on reviewing applicable industries;
Instructions for adjusting invoices and declarations;
Support in handling practical problems related to new tax policies.
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