Vietnam is set to abolish the simplified lump-sum tax system by 2026, requiring all registered businesses to transition to a declaration-based tax system. This change affects around 2 million household businesses and entrepreneurs who currently rely on estimated revenues. The initiative is part of Resolution 68, which seeks to empower local private companies as primary economic drivers by 2035. The resolution promises deregulation, increased protections, and improved access to capital while simultaneously aiming to enhance tax revenue amid rising public spending demands.
Vietnam's lump-sum tax system, used by around 2 million businesses, will be abolished in 2026, necessitating a transition to a declaration-based tax system.
Resolution 68 aims to empower Vietnam's homegrown private companies as the primary economic drivers by 2035, prioritizing them over foreign and state-owned enterprises.
The resolution includes promises of deregulation, enhanced protections for local firms, and improved capital access, while introducing legal principles for property rights and fair competition.
To increase tax revenue, Vietnam's government plans to boost public spending while enforcing a cap on public debt, indicating the need for new revenue sources.
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