On 14/6, the National Assembly passed the 2025 Corporate Income Tax Law, which regulates taxpayers, taxable income, tax exemptions, incentives, and corporate income tax collection. The new tax law will take effect from 1/10 of this year and will be applied from the 2025 corporate income tax calculation period. The new law has several revisions compared to current regulations.
Here's a comparison of some key aspects between the two versions:
| Category | 2025 CIT Law | Current CIT Law |
| Taxpayers | Expanded: Includes e-commerce platforms and digital platforms of foreign enterprises with revenue generated in Vietnam, even without a permanent establishment or headquarters. | Applies to organizations and enterprises (domestic and foreign) with establishments, headquarters, or commercial presence in Vietnam. Does not address cross-border digital platforms. |
| Taxable Income | - Adds: Differences from asset revaluation during capital contribution, mergers, and enterprise conversions; sponsorship money, bonuses, and contract penalties. - Differentiates real estate transfer income of real estate businesses (may not be taxed as before). - Applies IIR (global minimum tax), allowing deduction from corporate income tax payable. - Taxes all income generated in Vietnam from foreign enterprises, regardless of permanent establishment. | - Income does not include the above, only income from production and business activities, transfers, etc., as per old regulations. - Does not mention IIR or differentiate real estate income. - Taxes foreign enterprises only with a permanent establishment in Vietnam. |
| Tax Exemptions | - Expands exemptions for: Innovative startups, small and medium enterprises, converted household businesses, social and environmental enterprises, and scientific research. - Extends tax exemptions for first-time carbon credits and green bonds (interest and first-time transfers). - Incentive period can be up to 15 years with clear conditions and anti-abuse controls. | - Exemptions mainly for investment projects in disadvantaged areas or preferred sectors. - Tax exemptions only apply to certified emission reductions (CERs). - Exemption period: 2-4 years (full exemption), 50% reduction for the next 4-9 years. - Less stringent controls, prone to abuse or policy exploitation. |
| Tax Incentive Conditions | - Expands incentives for digital transformation and high-tech industries: Chip production, data, AI, key mechanics, and forensic appraisal. - Adds two new preferential tax rates: 15% (revenue under 3 billion VND) and 17% (revenue 3-50 billion VND) for small-scale businesses, based on annual revenue. - Clearly excludes discouraged industries: Alcohol, tobacco, casinos, prize-winning games, video games, speculative projects, and polluting industries. - Tightens post-inspection: Tax recovery and penalties for non-compliance. | - Incentives focused on: High technology, high-tech agriculture, education, healthcare, and environment. - Applies tax incentives without differentiating by revenue. - Does not clearly list excluded industries. - Loose post-inspection, lacks regulations for handling non-compliance. |
| Revenue-Based Taxation | Applies only to micro-enterprises (revenue less than 3 billion VND) or specific organizations. - Not industry-specific, no longer divided by activity type. - Adds application to non-profit organizations, cooperatives, non-resident foreign enterprises, etc. - More transparent, with stricter conditions to prevent tax loss. | - Applies to all types of enterprises if costs cannot be determined. - By industry: Goods (1%), services (5%), other industries (2%). - No clear subjects besides regular businesses. - Prone to abuse due to difficulty in cost control. |
Notes:
IIR (Income Inclusion Rule): Regulates minimum tax for multinational enterprises, first clearly defined in the 2025 CIT Law.
Incentive control mechanisms are more stringent to prevent abuse and meet EU and US standards in trade agreements.
Discouraged industries such as alcohol, tobacco, and casinos are excluded from incentives for the first time, promoting fairness and sustainability for the economy.
Hai My
