Value Added Tax Cuts, Retail Stocks Expected to Continue to Benefit

On June 17, the National Assembly officially passed a resolution to reduce value-added tax by 2% (from 10% to 8%) on most goods and services, effective from July 1, 2025 to December 31, 2026. The tax reduction does not apply to certain industries such as telecommunications, banking, real estate, and luxury goods/special consumption tax.

The VAT reduction will continue to boost household spending amid persistent macroeconomic uncertainties, reinforcing the government’s proactive stance in supporting domestic demand and stabilizing consumer sentiment. Unlike previous temporary VAT cuts, which were typically applied for only six months, this one will last for 1.5 years (July 2025 – December 2026) – three times longer – underscoring the government ’s strong commitment to stimulating domestic consumption, a key pillar of Vietnam’s GDP growth .

Mr. Nguyen Thanh Lam - Director of Research and Analysis of the Retail Banking Division of Maybank Investment Bank Securities Company said that additional demand-side measures are expected, such as amendments to the Personal Income Tax (PIT) Law to increase deductions and increase net disposable income. Together with the implementation of free public school tuition nationwide starting from September 2025, these direct measures are likely to maintain and improve purchasing power, supporting a stronger consumption recovery in the second half of 2025 and 2026.

“With a number of pro-growth policies underway – including accelerating public investment disbursement, continued fiscal stimulus packages and targeted support for the real estate and tourism sectors – we expect domestic consumption to continue to accelerate. The ambitious 2025 GDP growth target of 8% implies stronger private consumption going forward. Accordingly, retail sales are expected to grow 12% year-on-year in 2025, up from 9% in 2024,” Lam said.

The retail sector will outperform, supported by favorable cyclical and structural factors. According to Mr. Lam, Maybank maintains a positive view on the retail sector, underpinned by strong earnings growth prospects (SEG EPS FY2025E +37% YoY), favorable structural trends, and now enhanced by fiscal support.

Maintain BUY recommendations on MWG, PNJ, FRT and DGW, all of which have strong fundamentals and strategic positions to capture the ongoing consumer spending recovery and the structural shift to modern retail in the long term.

Source: https://baodautu.vn/giam-thue-gia-tri-gia-tang-ky-vong-co-phieu-ban-le-tiep-tuc-huong-loi-d307150.html