The Ministry of Finance proposed applying an annual turnover threshold not subject to personal income tax for households and individual businesses at 1 billion VND per year. It also proposed increasing the turnover not subject to value-added tax for households and individual businesses to 1 billion VND per year.\n\nThis 1 billion threshold doubles the current limit of 500 million VND, as defined by the Personal Income Tax Law 2025.\n\nAccording to the drafting agency, the 1 billion turnover threshold for tax exemption is consistent with the rule that households and individuals with annual turnover of 1 billion VND or more use electronic invoicing initiated by a cash register connected to electronic data transmission to the tax authority.\n\nCurrently, according to statistics from the tax authority, there are about 2.56 million households and individuals with turnover under 1 billion. With this proposal, the estimated reduction in state budget revenue would be about 16.65 trillion VND compared with 2025 (under the regime of estimated tax and the exemption threshold of 100 million per year) and about 4.85 trillion VND compared with the current policy that raised the exemption threshold to 500 million per year.\n\nAccording to the Ministry of Finance, from the start of 2026 to now, due to global conditions, the domestic economy has experienced many fluctuations;
fuel prices rose, input costs increased, purchasing power declined, and the activities of households and individuals engaged in business have faced difficulties. At the same time, this adjustment is necessary to ensure a scientifically-based tax policy, in line with the development trend of the digital economy, and to take into account the ability of taxpayers to comply and a reasonable incentive ratio to help curb tax evasion.\n\nRegarding this matter, at the first session of the 16th National Assembly, the Government is presenting to Parliament amendments to the Personal Income Tax Law to not fix the exemption threshold in law, but to assign the Government to set this threshold. During discussions in Parliament, Prime Minister Le Minh Hung stated that issues related to personal income tax, value-added tax, and excise tax are newly arising because the relevant laws were only passed at the end of 2025. The Prime Minister noted that the current Personal Income Tax Law sets the exemption threshold for households at 500 million VND but there have been difficulties due to fuel price fluctuations affecting priority groups such as households and SMEs. Therefore, the Government has directed the Ministry of Finance to urgently study options to report to the National Assembly and propose adjusting tax policy within this session if progress permits. The Prime Minister stressed that the policy must be very flexible. When the Government is tasked with defining specific tax rates, the National Assembly will have strict criteria or principles to prevent loopholes that could lead to tax revenue losses. He also said that immediately after the National Assembly passes the law, the Government will issue timely guiding decrees.
