HCMC – The 15th National Assembly has approved a proposal to extend a two-percentage-point reduction in value-added tax (VAT) for another six months until the end of June 2025, according to a resolution passed during the eighth sitting on November 30.
The decision aims to further stimulate the economy and boost consumer spending, amid ongoing global economic uncertainties. The VAT cut, first introduced in 2022, has been seen as a key measure to support businesses and households.
This marks the fourth consecutive year that the Vietnam has implemented a VAT reduction to stimulate economic growth and boost consumer demand, reported the Vietnam News Agency.
The Ministry of Finance estimated that this latest extension will result in State budget revenue falling by VND26.1 trillion in the first half of 2025. However, officials believed economic benefits, such as increased production and consumption, will outweigh the short-term fiscal impact.
Experts said the VAT cut extension would help to lower production costs for businesses, leading to reduced prices for consumers. This, in turn, is expected to spur demand and encourage businesses to expand their operations.
