New Legal Regulations July 1, 2025: How Businesses Need to Update & Act Now

Starting July 1, 2025, numerous new legal regulations will officially come into effect, directly impacting business operations, especially for micro, small, and medium-sized enterprises (SMEs), individual business households, or individuals operating on digital platforms.

This article summarizes the crucial legal changes that businesses need to be aware of to proactively adjust their operations, avoid legal risks, and seize new opportunities.

Key Legal Changes Taking Effect from July 1, 2025

To help businesses easily grasp these updates, here is a list of key legal documents and their effective dates:

• Enterprise Law 2020 (amended and supplemented in 2025), effective from July 1, 2025.

• Value-Added Tax Law 2024 and guiding documents, effective from July 1, 2025.

• Corporate Income Tax Law 2025, effective from October 1, 2025 (applied from the 2025 tax period).

• Law on Tax Administration 2019 (amended and supplemented in 2024).

• Decree 117/2025/ND-CP regulating tax administration for business activities on e-commerce platforms and digital platforms by households and individuals, effective from July 1, 2025.

• Decree 70/2025/ND-CP amending and supplementing several articles of Decree 123/2020/ND-CP (dated October 19, 2020) on invoices and documents, effective from June 1, 2025.

• Circular 32/2025/TT-BTC guiding the implementation of certain articles of the Law on Tax Administration (dated June 13, 2019), Decree 123/2020/ND-CP (dated October 19, 2020) on invoices and documents, and Decree 70/2025/ND-CP (dated March 20, 2025) amending and supplementing several articles of Decree 123/2020/ND-CP, effective from June 1, 2025.

• Social Insurance Law 2024, effective from July 1, 2025.

• And many other related documents…

Key New Points Businesses Need to Note

1. Increased Transparency in Company Information

• Businesses must identify and declare information about their beneficial owners – the individuals who truly own or control the enterprise.

• They must accurately declare the value of capital contributions/shares held or specifically the controlling rights over the enterprise.

• Stipulation in Article 1.1.d of the Law amending and supplementing certain articles of the Enterprise Law:

  • “Beneficial owner of a legal entity (hereinafter referred to as the beneficial owner of an enterprise) is an individual who actually owns the charter capital or has controlling rights over that enterprise, except for cases where the representative of the direct owner in an enterprise with 100% state-owned charter capital and the representative of state capital in a joint-stock company, or a limited liability company with two or more members, is regulated by law on state capital management and investment in enterprises.”

2. Expanded Scope of Compulsory Social Insurance Participants

From July 1, 2025, the following subjects will be required to contribute to compulsory Social Insurance (SI):

• Heads of business households (with business registration).

• Enterprise managers, capital representatives of enterprises as stipulated by law; members of the Board of Directors, General Directors, Directors, members of the Supervisory Board or supervisors, and other elected management positions of cooperatives and cooperative unions as stipulated by the Law on Cooperatives who do not receive salaries.

• Employees working under part-time labor contracts, whose monthly salary is equal to or higher than the minimum salary used as the basis for compulsory social insurance contributions.

3. Updates on E-invoices

• Additional subjects required to use e-invoices from cash registers:

  • Business households and individuals with annual revenue of VND 1 billion or more.

  • Businesses engaged in selling goods and providing services directly to consumers.

• Additional type of e-commerce invoice applicable to organizations and individuals engaged in export activities.

4. Updates on VAT

• Tax-exempt revenue threshold: Increased from VND 100 million to VND 200 million for business households and individuals (applicable from January 1, 2026).

• Additional subjects exempt from VAT: Exported products that are exploited natural resources and minerals processed into other products, etc.

• Additional subjects applying a 0% tax rate: International transport; Construction and installation works abroad, in non-tariff zones, etc.

• Products previously exempt from tax now subject to 5% tax: Fertilizers; Fishing vessels operating in sea areas, etc.

• Products previously subject to 5% tax now subject to 10% tax: Unprocessed forest products; Sugar; by-products from sugar production, etc.

5. Updates on CIT

One of the most notable points is the adjustment of CIT rates, particularly benefiting small and medium-sized enterprises (SMEs).

• New tax rates (applicable from the 2025 tax period):

  • 15%: Applied to businesses with total annual revenue not exceeding VND 3 billion.

  • 17%: Applied to businesses with revenue above VND 3 billion but not exceeding VND 50 billion.

  • 20%: Standard tax rate, applied to other businesses, except in cases of other specific preferential treatments.

Impact on Businesses and Necessary Actions

These changes will significantly impact business operations:

• Increased legal obligations: Must ensure transparency of ownership information and accurate capital declaration.

• Changes in operational methods: Related to invoicing and declaration processes.

• Obligation to provide and update the list of compulsory SI participants.

• VAT changes directly affecting product/service prices, requiring pricing policy adjustments.

• New CIT rates necessitate businesses to recalculate business plans and profitability.

To ensure compliance with legal regulations, businesses need to:

• Review legal documents: Supplement and declare beneficial owner information according to the new Enterprise Law.

• Determine appropriate invoice types: Check to use the correct type of e-invoice (invoices with tax authority codes, e-invoices generated from cash registers, e-commerce invoices) for each type of transaction.

• Check compulsory SI coverage: Review the list of employees, identify new subjects falling under compulsory SI contributions; concurrently, submit lists to competent state agencies.

• Re-evaluate products/services based on corresponding tax rates: Adjust invoices, contracts, product/service price lists, etc., to reflect the new VAT rates.

• Reconsider organizational models: Recalculate costs and profits corresponding to the new CIT rates to optimize business efficiency.

Conclusion

From July 2025, many new regulations officially take effect, bringing both challenges and opportunities for businesses. Proactively updating and making timely adjustments will help businesses:

• Operate in compliance with legal regulations.

• Avoid risks related to taxes, invoices, and insurance.

• Leverage existing incentives from state policies for sustainable development.

Ensure your business is ready to adapt to these changes to thrive in the new business environment.