HCMC – Vietnam’s Government has proposed raising the tax-exempt revenue threshold for household businesses to VND1 billion per year, up from VND500 million.
The proposal was submitted to the National Assembly on April 21 as part of amendments to the laws on personal income tax, value-added tax (VAT), corporate income tax, and special consumption tax, reported the Vietnam News Agency.
Prime Minister Le Minh Hung said the current threshold is no longer suitable as economic conditions have changed, especially fuel price fluctuations affecting small and medium-sized enterprises (SMEs) and household businesses.
Under the draft, household businesses with annual revenue below VND1 billion would not be subject to VAT and personal income tax, according to the Ministry of Finance.
Lawmakers supported revising the tax policy but raised concerns about implementation. Pham Thuy Chinh, deputy head of the National Assembly’s Economic and Financial Committee, cautioned that frequent changes could make enforcement difficult. She supported assigning the Government authority to set the threshold but requested a clear impact assessment.
Nguyen Ngoc Son, a full-time member of the Science, Technology and Environment Committee, called for clearer criteria to determine taxable revenue, including timing factors. He also warned of risks that businesses could split operations to remain below the threshold.
Prime Minister Hung said the policy must ensure fairness while easing burdens on household businesses and supporting SMEs. He added that detailed criteria and safeguards would be set out in a government decree to prevent loopholes and revenue losses.
