The National Assembly unanimously agreed to continue reducing VAT by 2% until the end of 2026.

On the morning of June 17th, with 452 out of 453 participating delegates voting in favor, the 9th Session of the 15th National Assembly officially passed the Resolution of the National Assembly on continuing to implement the policy of reducing value-added tax (VAT) in the period 2025–2026.

According to the Resolution, from July 1, 2025 to December 31, 2026, the VAT rate will be reduced by 2% for goods and services currently subject to a 10% rate, down to 8%. This tax reduction does not apply to certain groups of goods and services such as: telecommunications; finance; banking; securities; insurance; real estate business; metal products; mining products (excluding coal); and goods and services subject to excise tax (excluding gasoline).

The National Assembly has tasked the Government with guiding the implementation of the VAT rate reduction and organizing the deployment of this policy in a public, transparent, and effective manner, ensuring that it achieves the objectives of supporting people and businesses and stimulating domestic consumption.

From 2022 to the first six months of 2025, the National Assembly repeatedly resolved to reduce the VAT rate by 2% as one of the key solutions to support the economy in overcoming the difficult period. This policy, along with a series of other tax, fee, and levy reductions, has practically contributed to helping businesses reduce input costs, improve production and business efficiency, enhance profits, and create favorable conditions to increase domestic purchasing power.

However, despite the achievements, the Vietnamese economy still faces numerous challenges. Growth drivers such as production, consumption, and investment have not yet shown significant breakthroughs. Domestic purchasing power, while improving, is still slow. Some industries and business sectors continue to face difficulties due to high input costs. In particular, the US announcement of retaliatory tariffs on several countries, including Vietnam, is increasing pressure on the domestic economy, especially in terms of exports and international trade.

Domestic consumer demand is therefore continuously identified as a crucial driver for economic growth in the current context. The VAT reduction policy is expected to create more room to support businesses in recovering and expanding production and business activities, while simultaneously stimulating personal consumption and contributing to the consolidation of the economic recovery in 2025 and 2026.

With a 2% reduction in the VAT rate, the cost of goods and services will decrease, thereby boosting consumption, increasing circulation of goods, and improving purchasing power in the market. At the same time, this will also help businesses reduce production costs and lower product prices, thus enhancing their competitiveness in both domestic and export markets.

It is projected that the total reduction in state budget revenue due to the implementation of the VAT reduction policy in the last six months of 2025 and the whole year of 2026 will be approximately VND 121,740 billion. Of this, the reduction in the last six months of 2025 alone is approximately VND 39,540 billion, and the reduction in the whole year of 2026 is approximately VND 82,200 billion.

Although this is a rather large amount in the context of the State budget needing to balance many important expenditure tasks, the National Assembly assessed that continuing to implement the VAT reduction policy is necessary and appropriate, helping to increase the ripple effect of demand-stimulating measures, supporting economic recovery and macroeconomic stability, and clearly demonstrating the spirit of accompanying and sharing difficulties with the people and the business community.

This is also an important solution to institutionalize the socio-economic development goals for 2025, aiming for a growth rate of 8% or higher, contributing to creating a solid foundation for achieving double-digit growth rates in the 2026-2030 period.

Also this morning, the National Assembly voted to pass the Law amending and supplementing a number of articles of the Enterprise Law, with 455 out of 457 National Assembly deputies present voting in favor.

Thanh Duy