The National Assembly has extended the 2% VAT cut for eligible goods and services from 1 July 2025 to 31 December 2026.

Vietnam’s National Assembly passed Resolution No. 204/2025/QH15 on 17 June 2025, extending the reduced VAT rate of 8% (down from 10%) for eligible goods and services until 31 December 2026.

The new rate takes effect from 1 July 2025.

The reduction applies to items listed in Clause 3, Article 9 of the VAT Law No. 48/2024/QH15, covering import, manufacturing, processing, and trading. However, it excludes sectors such as:

  • Telecommunications
  • Finance, banking, securities
  • Insurance
  • Real estate
  • Metal and mineral products (excluding coal)
  • Goods under special consumption tax (excluding petrol)

The scope of the VAT cut has been expanded to include logistics, transportation, goods distribution, and IT services. The policy is expected to reduce state revenue by VND 26.1 trillion (USD 1.03 billion), with the government responsible for maintaining budget balance.