Proposal to reduce income tax by 30% for business households and enterprises with revenue of up to VND 10 billion
The government is preparing to submit a proposal to the National Assembly for consideration regarding a 30% reduction in income tax for the 2026–2027 period for households, self-employed individuals, and businesses with annual revenue of up to VND 10 billion, as well as raising the revenue threshold for determining the simplified tax calculation method.
In recent times, the government has implemented numerous measures regarding tax, fee, and charge exemptions, reductions, and extensions for businesses and citizens. To continue encouraging and facilitating the development of production and business operations for households, individual business operators, and small and medium-sized enterprises (SMEs)—thereby contributing to economic growth, ensuring macroeconomic stability, controlling inflation, and maintaining the major economic balances— the Government is urgently finalizing proposals to submit to the National Assembly for consideration regarding measures to reduce corporate income tax and personal income tax, as well as to raise the revenue threshold for applying a simplified tax calculation method for households, individual business operators, and micro-enterprises.
Specifically, a 30% reduction in personal income tax will be applied to households and self-employed individuals with annual revenue of up to VND 10 billion in 2026 and 2027, and a 30% reduction in personal income tax for micro-enterprises with annual revenue of up to VND 10 billion in 2026 and 2027.
These measures aim to support and facilitate the development of households, individual business operators, and small and medium-sized enterprises. The Prime Minister has instructed the Ministry of Finance to urgently take the lead, in coordination with the Ministry of Justice and relevant agencies, in drafting a Resolution on reducing personal income tax and corporate income tax for business households, self-employed individuals, and enterprises, to be submitted to the National Assembly at the First Extraordinary Session (August 2026) in accordance with the provisions of Clause 2, Article 26 of the Law on the Issuance of Legal Documents.
In addition, the annual revenue threshold for business households and individual business operators to opt for the simplified tax method (tax rate × revenue) shall be raised from VND 3 billion to VND 10 billion per year. At the same time, the annual revenue threshold for businesses to opt for the tax rate (x) multiplied by revenue method has been raised to match the adjustment level for households and individual business operators, set at VND 10 billion per year.
This measure aims to address the difficulties faced by business households and individual business operators, reduce time and costs, and alleviate concerns regarding compliance with tax, accounting, and invoicing laws, while ensuring policy consistency and encouraging business households to transition into enterprises. These measures will be incorporated into the amended Law on Support for Small and Medium-Sized Enterprises and submitted to the National Assembly for review and approval at its second session (October 2026)./.