Vietnam's government has issued Decree 398/2026/ND-CP, cutting by 30% the personal income tax and corporate income tax payable for the 2026 and 2027 tax years by business individuals and enterprises whose annual revenue does not exceed 10 billion dong, VietnamPlus reported. The decree took effect on 29 October 2026 and implements a National Assembly resolution. Value-added tax is not covered.
Who qualifies
KBVN+ summarises the decree:
| Item | Individuals and household businesses | Enterprises and other organisations |
|---|---|---|
| Tax cut | Personal income tax on business income | Corporate income tax |
| Reduction | 30% of tax payable | 30% of tax payable |
| Years | 2026 and 2027 | 2026 and 2027 |
| Revenue cap | 10 billion dong a year | 10 billion dong a year |
| How to claim | In quarterly, half-yearly or annual returns | Self-assessed in quarterly provisional payments |
| If revenue exceeds the cap | Repay the reduction, no late-payment interest up to the filing deadline for that period | Pay the shortfall; late interest under tax law |
Eligible individuals are resident business owners, including registered household business heads or authorised household representatives, regardless of how their tax is calculated. Parties that withhold or file tax on their behalf also get the 30% cut. For companies, the scheme covers enterprises, cooperatives, public service units and other organisations with business income. Where a firm already enjoys tax incentives, the 30% applies to the tax remaining after those incentives.
Fine print
The 10 billion dong threshold is based on total actual revenue for the year. For companies that includes sales, services, financial income and other income, plus revenue from branches and dependent units. Firms created by splitting a business after the resolution took effect are excluded if their combined revenue exceeds the cap. If an audit raises the tax owed, the extra amount still qualifies for the cut, provided the revenue condition is met.
What it means
The measure targets small traders and micro firms. In simple terms, an eligible business that owes 100 million dong in income tax for a year would pay 70 million dong. Owners need to watch cumulative revenue: once it passes 10 billion dong, individuals must adjust their filing in that period and pay back the reduction.
What comes next
With the decree already in force, individuals can include the reduction in upcoming tax returns, and companies can apply it to their quarterly provisional corporate income tax. The relief covers the 2026 and 2027 tax years.