Vietnam’s Deputy Prime Minister Ho Duc Phoc has signed Decision No. 01/2025/QD-TTg (Decision 01), which repeals duty-free imports for goods valued at VND 1 million or less (Decision No. 78/2010/QD-TTg) on 3 January 2025.
Under Decision 78, goods delivered via express valued up to VND 1 million were exempt from import duty and VAT, while those exceeding this amount were taxed.
The Decision 01 was introduced because the previous tax exemptions created an unfair advantage for imported goods, which were VAT-exempt under VND 1 million while local products were taxed. The exemption caused price imbalances and negatively impacted the competitiveness of local goods.
Decision 01 aims to resolve this by ensuring consistent taxes, supporting domestic production, and promoting fair competition. Decision 01 also aims to align tax policies for small-value imports with international standards, promote local goods consumption, expand the tax base and boost tax collection.
The Decision 01 will go into effect on 18 February 2025.
Earlier, the Vietnam government extended the reduced value-added tax (VAT) rate from 10% to 8% for eligible goods and services during the first half of 2025, which goes into effect from 1 January 2025 to 30 June 2025 on 31 December 2024.
