Experts recommend tax exemption for businesses with revenue under 1 billion VND

From January 1, 2026, lump-sum tax will be completely abolished and switched to a self-declaration mechanism. This conversion is an inevitable trend, aiming at fair and transparent tax management. However, some experts believe that the level of non-taxable revenue of business households should be raised to 1 billion VND to match current reality.

98% of business households have declared and paid taxes electronically.

According to Mr. Mai Son, Deputy Director of the Tax Department ( Ministry of Finance ), the conversion from lump-sum tax to declaration is an important step to implement the Party and State's policy on fair and transparent tax management and create conditions for private economic development.

“The transition from lump-sum tax to declaration is not just a change in tax calculation, but a comprehensive transformation, from management methods, service mindset and ways of accompanying taxpayers,” Mr. Mai Son emphasized.

To date, 133,000 business households have registered to use electronic invoices from cash registers (Illustration photo)

The Tax Department's leaders informed that up to now, 98% of business households have declared and paid taxes electronically, more than 18,500 households with fixed tax have switched to declaration, and 133,000 households have registered to use electronic invoices from cash registers. The key goal in the coming time is to help business households fulfill their tax obligations conveniently, safely, transparently and modernly.

Currently, the tax sector has synchronously deployed many solutions such as researching and amending policies; promoting propaganda, dialogue, and practical guidance; simplifying accounting regimes and applying easy-to-use technology.

Deputy Director Mai Son said that the Ministry of Finance has been implementing a roadmap to accompany business households in eliminating lump-sum taxes. At the same time, the agency is also perfecting the legal framework, amending the Law on Tax Administration and related documents, with the goal of encouraging business households to be transparent about costs, boldly invest in expanding their business without worrying about losing tax compared to enterprises.

Large-scale businesses that operate systematically and have complete accounting books will be subject to personal income tax on their actual profits, similar to enterprises. Small-scale businesses are still given favorable conditions, minimizing costs and procedures.

Regarding the implementation of the direction of eliminating lump-sum tax, the tax authority has researched and evaluated a new tax management model for business households. The focus is on grouping business households according to revenue thresholds to determine appropriate management methods, apply corresponding risk management and compliance management mechanisms.

In addition, the Tax Department closely coordinates with units of the Ministry of Finance to develop reports and propose amendments to regulations on accounting regimes for business households and micro-enterprises in a simple, easy-to-implement manner, without creating accounting staff. The goal is that when business households convert to enterprise models, the household owners can still maintain their own books on the support application, minimizing the cost of specialized accounting.

Proposal to exempt tax for business households with revenue under 1 billion VND

From a professional perspective, Ms. Nguyen Thi Cuc, Chairwoman of the Vietnam Tax Consultants Association (VTCA), believes that the shift from lump-sum tax to declaration is an important reform in modernizing tax management, helping to make revenue transparent, tax obligations fair, and reduce risks for both tax authorities and taxpayers.

Ms. Nguyen Thi Cuc said that lump-sum tax is actually making business households passive. For example, in the case of natural disasters such as floods, business households, even if they have no revenue, still have to pay lump-sum tax. Meanwhile, if they switch to tax declaration, business households only have to pay tax when they generate revenue.

Besides, according to the Chairman of VTCA, applying the declaration method for individual business households will prevent tax evasion.

Ms. Cuc cited that recently, there have been continuous cases of counterfeit goods, poor quality goods, and tax evasion with large sums of money from famous people on the internet such as: Hoang Huong, Quang Linh, Hang Du Muc, Ngan 98..., to individuals doing business but not paying taxes, being detained for investigation and prosecution for tax evasion such as Ms. H in Hanoi with a revenue of 834 billion VND; Ms. Th and T in Ho Chi Minh City with 90 billion VND; Mr. C in Hanoi with a revenue of more than 160 billion VND... but did not declare or pay taxes.

Therefore, for individual businesses, Ms. Cuc believes that when business households apply tax declaration, implement accounting regimes, use invoices and documents and further convert into enterprises, management and business efficiency will be much better. The State creates favorable conditions in terms of infrastructure, land rent, as well as providing shared accounting software.

Currently, business households and individuals with revenue in the 2025 calendar year of less than VND 100 million will not have to pay sales tax. According to the Law on Value Added Tax, business households with revenue of less than VND 200 million from June 1, 2026 will not have to pay value added tax and personal income tax.

Ms. Cuc said that the tax authority is seeking opinions on raising the threshold for non-taxable revenue, but she recommended that the revenue level for households and individuals doing business without paying tax should be raised from 200 million VND to 1 billion VND/year.

Explaining this proposal, Ms. Cuc said that if households and individuals have a revenue of 1 billion VND, if multiplied by an average yield of about 15 - 16%, they will only achieve a profit of 150 million VND/year, equivalent to less than 14 million VND/month.

This level is not as high as the family deduction for personal income taxpayers which is 15.5 million VND/month. Not to mention, personal income taxpayers are also entitled to a deduction for each dependent of 6.2 million VND/month.

“Tax exemption for households with revenue under 1 billion VND is reasonable and feasible. We hope the tax authority will consider and support this proposal,” Ms. Cuc emphasized.

According to Cam Tu/VOV.VN

Source: https://baovinhlong.com.vn/kinh-te/202510/chuyen-gia-kien-nghi-mien-thue-cho-ho-kinh-doanh-co-doanh-thu-duoi-1-ty-dong-2ca0768/