Update new points of Law on Corporate Income Tax 2025

On 14^th June 2025, the National Assembly passed the Law on Corporate Income Tax (CIT) No. 67/2025/QH15, effective from 01^st October 2025 and applicable from the 2025 corporate income tax period.

Gia Luat would like to send to our customers some outstanding new points of the Law on Corporate Income Tax 2025, including:

1. Tax regulations for foreign enterprises without permanent establishments in Vietnam

Foreign enterprises without a permanent establishment in Vietnam, including e-commerce or digital platform-based enterprises, must pay CIT on taxable income arising in Vietnam.

The principle for determining taxable income is income received originating from Vietnam, regardless of the location of business.

2. Reduce tax exemption period for income from sales of new technology products

The tax exemption period for income from the sale of products made with new technology applied for the first time in Vietnam will be reduced from 5 years to 3 years.

3. Expanding the subjects exempted from corporate income tax

The Law on CIT 2025 expands the scope of CIT exemption for:

• Income from the transfer of emission reduction certificates, the first transfer of carbon credits after issuance by enterprises granted emission reduction certificates, carbon credits;
• Income from green bond interest;
• Income from the first transfer of green bonds after issuance.

4. Additional deductible expenses when determining taxable income

Expenses added to the list of deductible expenses include:

• Actual expenses for people participating in the administration, operation, and control of specially controlled credit institutions, commercial banks that are subject to compulsory transfer under the provisions of the Law on Credit Institutions.
• Some expenses serving the production and business of enterprises but not corresponding to the revenue generated during the period under the Government's regulations.
• Some expenses support the construction of public works, while also serving the production and business activities of enterprises.
• Expenses related to reducing greenhouse gas emissions to neutralize carbon and net zero, reduce environmental pollution, while also related to the production and business activities of enterprises.
• Some contributions to funds were established under the Prime Minister's decision and Government regulations.

5. Input VAT that has not been fully deducted is included in deductible expenses.

Input VAT directly related to the production and business of an enterprise that has not been fully deducted but is not eligible for tax refund is included in deductible expenses when determining taxable income for CIT.

Input VAT included in deductible expenses cannot be deducted from output VAT.

6. Offsetting losses from real estate transfers against taxable income

Enterprises that incur losses from the transfer of real estate, investment projects, or rights to participate in investment projects may offset the losses against taxable income from other production and business activities of the enterprise's own choice, except for income from activities enjoying tax incentives.

Note: Taxable income from the transfer of mineral exploration, exploitation and processing investment projects; transfer of rights to participate in mineral exploration, exploitation and processing investment projects; transfer of mineral exploration, exploitation and processing rights must be determined separately for tax declaration and payment. Losses and profits cannot be offset against production and business activities in the tax period.

7. Regulations on CIT rates

The CIT rate is 20%, except in the following cases:

• The tax rate of 15% applies to enterprises with total annual revenue not exceeding VND 3 billion.
• The tax rate of 17% applies to enterprises with total annual revenue from over VND 3 billion to no more than VND 50 billion.
• The revenue used as the basis for determining enterprises eligible for the tax rate of 15% and 17% is the total revenue of the previous corporate income tax period. The determination of total revenue used as the basis for application is implemented according to Government regulations.
• For oil and gas exploration and exploitation activities from 25% to 50%. Based on the location, exploitation conditions and mine reserves, the Prime Minister decides on the specific tax rate suitable for each oil and gas contract;
• For exploration and exploitation of rare resources (including platinum, gold, silver, tin, tungsten, antimony, precious stones, rare earths and other rare resources as prescribed by law), the tax rate is 50%. In case of mines with 70% or more of the assigned area located in areas with particularly difficult socio-economic conditions, the tax rate is 40%.

Note: Preferential tax rates do not apply to enterprises that are subsidiaries or affiliated companies where the affiliated enterprise is not an enterprise that meets the conditions for applying preferential tax rates.

8. Changes in business line with preferential tax rates

• Remove some business lines that enjoy incentives:
  • Production projects with a minimum investment capital of VND 6,000 billion;
  • Investment projects in industrial parks;
• Adding preferential business lines that have been specifically regulated for corporate income tax incentives according to current regulations:
  • Projects subject to special investment incentives and support as prescribed in Clause 2, Article 20 of the Law on Investment 2020;
  • Investing in technical facilities to support small and medium-sized enterprises and incubators for small and medium-sized enterprises; Investing in co-working spaces to support small and medium-sized enterprises starting up creatively according to the Law on Support for Small and Medium-sized Enterprises.

9. Adjusting tax rates for new investment projects in the automobile manufacturing and assembly industry

CIT for new investment projects in the automobile manufacturing and assembly industry is adjusted from 10% to 17% and the incentive application period is reduced from 15 years to 10 years.

Above is the content of some outstanding new points of the Law on Corporate Income Tax 2025 that Gia Luat would like to send to Valued Client for your reference. Should Valued Client any questions, please kindly contact Gia Luat for the best support.