Transitioning from lump-sum tax to declaration-based tax - Creating momentum for the development of household businesses (Part 1): Concerns of household businesses during the transition

The transition from lump-sum tax to tax declaration for household businesses is a crucial step in tax policy reform. It also presents an opportunity for household and individual businesses in Thanh Hoa province to change their management and operations towards a more professional, transparent, and fair approach, encouraging them to transform into enterprises. This is also an important prerequisite for realizing the goal of developing the private sector into a key driving force of the national economy.

Tax officials at the grassroots level in Thanh Hoa province are guiding business households using a "hands-on" approach to ensure a smooth and compliant transition.

Recently, the policy of abolishing lump-sum tax for business households has caused a stir in public opinion because it affects tens of thousands of business households in the province. Among them, many business households, lacking accurate information, are still confused about new concepts such as electronic invoices, sales management software, cash registers connected to the tax authorities, and are concerned about risks, associated costs, and the skills needed to use advanced software and technology.

According to Resolution No. 198/2025/QH15 of the 15th National Assembly, from January 1, 2026, business households and individual businesses will no longer apply the lump-sum tax payment method, but will pay taxes according to the law on tax administration. To implement this policy, the Ministry of Finance issued Decision No. 3389/QD-BTC in 2025 approving the plan for converting the model and method of tax management for business households when the lump-sum tax is abolished. Accordingly, from January 1, 2026, business households will officially switch from the lump-sum tax method to the declaration and self-payment method. As of early December 2025, the province had over 92,000 business households, of which 2,406 had paid taxes using the declaration method, 1,882 had registered to use electronic invoices generated from cash registers, and more than 31,000 business households paid taxes under the lump-sum method.

Instead of paying a fixed tax as before, business households will declare and pay taxes based on their actual revenue. This change aims to help tax authorities closely monitor revenue and prevent tax fraud through the use of electronic invoices. Feedback from business households indicates that they agree with the policy of switching from a fixed tax rate to a declaration-based system to increase transparency and modernize tax management, but implementation needs a specific roadmap. Tax authorities should provide free, user-friendly, and standardized declaration software across the entire system. Simultaneously, the declaration process should be simplified, reducing technical steps so that even small business owners, elderly people, and those with little technological knowledge can easily complete the process.

Mr. Nguyen Van Hai, a mobile phone business owner on Le Lai Street, Hac Thanh Ward, said: “My shop sells mobile phones, with many products costing up to 50 or 60 million VND, so monthly revenue is very high, but the actual profit is very low. Along with that, the costs of importing goods, implementing promotional programs, renting premises, etc., are also high. If we only look at revenue to calculate taxes, businesses like ours are easily disadvantaged. Therefore, I think paying taxes based on profit would be more reasonable. I hope that the government will research and implement the most suitable tax calculation method in the future, creating fairness and encouraging business development.”

One of the biggest concerns for business owners is the need to use electronic devices for managing inventory, filing declarations, and paying taxes. In reality, many businesses are currently managed manually, recording sales by hand. Many small businesses or those owned by elderly people have limited technological literacy.

Ms. Nguyen Thi Mai, a business owner on Dao Duy Tu Street, Hac Thanh Ward, shared: "My family runs a food and beverage business. For a long time, we've mainly managed our business by manually assessing and calculating revenue and profit from daily transactions, rather than using ledgers or electronic software. When I heard about the need to switch to tax declaration, I was worried and couldn't imagine how we would have to inspect goods, declare, and pay taxes."

Similarly, Ms. Nguyen Thi Mui, a business owner on Phan Boi Chau Street, Hac Thanh Ward, shared: "My grocery store has many items, some worth millions of dong, while others are only worth a few thousand dong. Now, having to meticulously inventory each item will take a lot of time. Moreover, I've always sold small quantities of goods, supplying daily necessities to people, so I've never thought about having to issue invoices for each order. I usually monitor revenue and profit based on total daily sales and estimate the profit. The tax authorities have been providing very specific training and information on using tax declaration equipment in recent days, but I'm still quite worried because of my age and my inability to use technology quickly. I know this is a general regulation, and business owners like us are willing to comply, but I hope the government will find ways to support elderly people so that fulfilling their tax obligations becomes easier."

The Tuan Hang business household in Yen Dinh commune has switched from lump-sum tax payment to declaration-based tax payment.

With just over two weeks left until the policy of abolishing lump-sum tax for household businesses officially takes effect, many businesses in the area are still confused about implementing the regulations. In light of this, the Thanh Hoa Provincial Tax Department is entering a "race against time" to implement various solutions to support household businesses. The Thanh Hoa Provincial Tax Department has gathered information on people's concerns and has directed local tax teams to address specific issues. Halfway through the 60-day intensive campaign to support household and individual businesses in transitioning to a tax declaration model, tax authorities at all levels have gone directly to the area to disseminate information and provide hands-on guidance to ensure people feel confident in the transition. Simultaneously, they have coordinated with electronic invoice service providers to offer support policies regarding equipment and service costs for household businesses during the initial implementation phase. Collaborate with associations, tax agents, and accounting and auditing firms to implement free awareness campaigns and support for business households in transitioning to the new business model. Review business households that do not yet have Etax Mobile accounts and provide guidance on installing and using the application.

In addition, to support household businesses in their transformation, technology solution providers such as Viettel, Thanh Hoa Telecommunications, Mobifone, Misa , Sapo, and KiotViet are collaborating with tax authorities to design user-friendly, cost-effective applications with on-site support teams. These solutions not only assist with tax declarations and invoice issuance but also act as "digital assistants," helping household businesses gradually adopt modern management models, facilitating expansion or conversion into enterprises in the future.

During the implementation process, Thanh Hoa Tax Department adopted the motto "support first - supervision later" to guide and help business households familiarize themselves with the declaration process before entering the compliance supervision phase, absolutely avoiding causing inconvenience to taxpayers. All questions from business households will be answered within 24 hours; those facing difficulties will receive direct, hands-on guidance to ensure a smooth and compliant transition. The Thanh Hoa Tax Department aims for 100% adoption of the self-declaration and tax payment method from January 1, 2026.

Despite numerous obstacles, particularly in rural and mountainous areas where technological infrastructure is limited and a high proportion of elderly small business owners exist, the tax authorities' persistence is gradually yielding positive results in the transition. With the support of local governments and a shift in the mindset of business households, the process of eliminating lump-sum taxes and switching to declaration-based tax systems will undoubtedly become smoother, contributing to a transparent, stable, and sustainable business environment.

Text and photos: Phuong Ngoc

Lesson 2: No business household should be left behind during the transition process.

Source: https://baothanhhoa.vn/chuyen-tu-thue-khoan-sang-ke-khai-tao-dong-luc-cho-phat-trien-ho-kinh-doanh-bai-1-tran-tro-cua-ho-kinh-doanh-khi-chuyen-doi-271492.htm