Officially reduce 2% VAT until the end of 2026

On the morning of June 17, with the majority of delegates voting in favor, the National Assembly officially passed the Resolution to reduce VAT by 2% from July 1, 2025 to December 31, 2026.

According to the newly passed Resolution, the National Assembly resolved to reduce the VAT rate applied to groups of goods and services specified in Clause 3, Article 9 of Law on Value Added Tax No. 48 by 2% (to 8%).

The National Assembly decided to reduce VAT by 2% from July 1, 2025 to the end of 2026. (Photo: quochoi.vn)

Before the National Assembly voted to approve, explain and receive opinions on the draft law, Minister of Finance Nguyen Van Thang said that some opinions proposed to apply a 2% VAT reduction for all goods. However, there were also opinions suggesting that instead of reducing 2% for many subjects, a 4-5% reduction should be applied to the right subjects in need of support.

The Resolution stipulates a 2% reduction in value-added tax (VAT) rates, applicable to groups of goods and services currently subject to 10% tax, except for the following groups of goods and services: telecommunications, financial activities, banking, securities, insurance, real estate business, metal products, mining products (except coal), goods and services subject to special consumption tax (except gasoline).

This draft Resolution expands the subjects eligible for tax reduction compared to the provisions of previous National Assembly Resolutions and extends the tax reduction period until the end of 2026. Accordingly, transportation, logistics, goods, and information technology services are eligible for tax reduction.

In addition, according to the provisions of the law on VAT, teaching, vocational training and medical services are not subject to VAT, so there is no need to reduce tax.

Besides, services such as finance, banking, securities, and insurance are not subject to VAT, so there is no need to reduce VAT, while telecommunications and real estate services are industries that have grown in recent times.

Minister of Finance Nguyen Van Thang explains and accepts comments on the draft law. (Photo: truyenhinhnghean.vn)

Minister of Finance Nguyen Van Thang said that according to the plan submitted by the Government, the expected reduction in state budget revenue in the last 6 months of 2025 and the whole year of 2026 is about 122,000 billion VND. In case of implementing tax reduction according to the plan to reduce all items subject to the 10% VAT rate, the expected reduction in budget revenue is equivalent to 167,000 billion VND.

In response to concerns that continued tax reductions will affect spending tasks, the Minister of Finance affirmed that VAT reductions will reduce budget revenue but also stimulate production and promote business activities. This tax reduction will contribute to creating additional revenue for the State budget (including the possibility of increasing revenue from other taxes thanks to the spillover effect of the VAT reduction policy).

In order to compensate for the shortfall in revenue due to policy implementation, the Government will focus on directing the State budget collection, strengthening management, reforming administrative procedures, promoting digital transformation in tax management, especially in key areas and areas, land revenue, real estate transfer, e-commerce activities, and business activities on digital platforms. The Minister of Finance also emphasized that the Government will direct the strict management of budget expenditures, increase cost savings...

Source: https://thoidai.com.vn/chinh-thuc-giam-2-thue-vat-den-het-nam-2026-214287.html