Abolition Of Presumptive Tax For Business Households From January 1, 2026

The National Assembly has officially approved a crucial Resolution, introducing numerous breakthrough mechanisms and policies to foster the development of the private economic sector. Notably, this includes the abolition of the presumptive tax calculation method for business households starting January 1, 2026.

On the morning of May 17, with high consensus, the National Assembly voted to pass the Resolution on special mechanisms and policies for private economic development. This is great news for millions of business households, enterprises, and individuals operating across the country.

Receiving Feedback, Institutionalizing Policies

Before the Resolution was passed, Minister of Finance Nguyen Van Thang presented the report on receiving and adjusting feedback, demonstrating serious consideration and explanations for opinions from the National Assembly Standing Committee and 113 National Assembly delegates. The government meticulously reviewed the viewpoints, guidelines, tasks, and solutions outlined in Resolution No. 68-NQ/TW, the current legal system, and ongoing amended and supplemented laws. The objective is to immediately institutionalize clear, specific, urgent, and promptly actionable mechanisms and policies that will significantly impact the confidence and business operations of the private economic sector.

The remaining tasks and solutions of Resolution No. 68-NQ/CP will continue to be studied for maximum institutionalization in the draft Laws submitted to the National Assembly at the 9th Session and subsequent sessions.

5 Key Policy Groups

The policies stipulated in this Resolution are divided into five main content groups, including:

• Improving the business environment: Regulating principles for inspection, examination, licensing, certification, competition, and access to resources for enterprises (DN), business households, and individual business owners; principles for handling violations and resolving business-related cases.
• Supporting access to land and business premises: Specifying numerous state support policies, while decentralizing power to localities to proactively balance resources and independently determine support norms and criteria for enterprises, business households, and individual business owners.
• Tax and fee support policies:
  • Exemption from Corporate Income Tax (CIT) for 2 years and a 50% reduction for the subsequent 4 years for income from innovative startup activities.
  • Exemption from Personal Income Tax (PIT) and CIT for income from the transfer of shares, capital contributions, rights to contribute capital, rights to purchase shares, rights to purchase capital contributions in innovative startup enterprises.
  • Exemption from PIT for 2 years and a 50% reduction for the subsequent 4 years for income from salaries and wages received by experts and scientists from innovative startup enterprises, research and development centers, innovation centers, and intermediary organizations supporting innovative startups.
• Supporting research, development, application of science, technology, innovation, and digital transformation:
  • Enterprises can deduct up to 20% of their taxable CIT income to establish a fund for science, technology, innovation, and digital transformation development.
  • Enterprises can include 200% of the actual costs of their research and development activities as deductible expenses for CIT calculation, as regulated by the Government.
• Support policies for specific enterprise types:
  • Income tax exemption for 3 years for small and medium-sized enterprises (SMEs) from the date of their first enterprise registration certificate.
  • Abolition of presumptive tax for business households from January 1, 2026: Business households and individual business owners will no longer apply the presumptive tax method but will pay taxes according to tax administration laws.
  • The state will allocate funds to provide free digital platforms and shared accounting software for small and micro enterprises, business households, and individual business owners.
  • Public projects, construction bids, goods procurement bids, and mixed goods and construction bids using the state budget, with a bid value of no more than 20 billion VND, will be reserved for SMEs, prioritizing those owned by youth, women, ethnic minorities, people with disabilities, and enterprises in mountainous, border, and island areas. (If no SMEs meet the requirements after initial bidding, re-bidding is allowed without this specific reservation).
  • Allocation of state budget for implementing a program to train and develop 10,000 executive directors by 2030.
  • Provision of free legal consultation, enterprise management, accounting, tax, and human resources training services for small and micro enterprises, business households, and individual business owners.

Requirements For Legal Refinement And Administrative Procedure Reduction

The Resolution also requires:

• No later than December 31, 2026, the completion of reviewing, amending, supplementing, and perfecting laws on land, planning, investment, and other laws related to business investment to fully institutionalize Resolution No. 68.
• No later than December 31, 2025, the Government must complete the review and elimination of unnecessary business conditions, overlapping regulations, and unsuitable provisions hindering the development of private enterprises; implementing at least a 30% reduction in administrative procedure processing time, at least a 30% reduction in legal compliance costs, at least a 30% reduction in business conditions, and continuing significant reductions in subsequent years.

This Resolution takes effect from the date of its approval by the National Assembly and applies to enterprises, business households, individual business owners, and other relevant organizations and individuals. In cases of differing regulations on the same matter between this Resolution and other laws or resolutions of the National Assembly, the provisions of this Resolution shall apply. However, if another legal document contains more favorable or preferential mechanisms or policies than this Resolution, those provisions shall apply.

The abolition of presumptive tax for business households from 2026 and other comprehensive support policies are expected to create strong momentum, helping Vietnam’s private economic sector to make breakthroughs in the coming period.