Vietnam’s VAT Reduction Measures Extended Until the End of June 2025

At the end of 2024, the Vietnamese government passed a resolution to extend the VAT reduction for specific product categories until June 30, 2025. Goods and services currently subject to a 10% VAT rate will receive a 2% reduction, effectively lowering the rate from 10% to 8%. This relief measure covers eligible goods and services, including imports, manufacturing, processing, and trade. The affected industries include manufacturing and processing, tourism, transportation, accommodation services, aviation, education and training, catering services, and social housing.
According to the Vietnamese government’s assessment, maintaining a lower VAT rate for the first half of 2025 will stimulate consumer demand in line with the current economic context, thereby accelerating the recovery and development of production and business activities. While the VAT reduction may lead to decreased national budget revenue, it is expected to encourage production and promote business operations.

Source: International Trade Administration