Fuels subject to 8% VAT until end-2026

HCMC – Fuel, coal, information technology services, and other items will enjoy a value-added tax (VAT) reduction of two percentage points until the end of next year, according to a resolution passed by the National Assembly on the morning of June 17.

The VAT will be 8% for certain goods and services currently subject to the 10% rate, according to the resolution, which was approved with 452 out of 453 deputies voting in favor, and will take effect from July 1 and remain in force until December 31, 2026.

These include fuels, information technology services, chemical and fabricated metal products, as well as coke and coal (for imported and wholesale commercial transactions).

The VAT reduction will not apply to certain categories of goods and services, including telecommunications, financial, banking, securities, and insurance services; real estate business; metal products; mineral products (except coal); and goods and services subject to special consumption tax (except fuels).

Minister of Finance Nguyen Van Thang said that under the Government’s proposed plan, state budget revenue would fall by an estimated VND122 trillion in the second half of 2025 and all of 2026.

He emphasized that while the VAT reduction would lead to lower state budget revenues, it would also help stimulate production and boost business activities. The policy is expected to generate additional revenue for the state budget, including potential increases in other taxes due to the spillover effects of the VAT cut.

To offset the shortfall, the Government will intensify efforts to enhance revenue collection by strengthening management, streamlining administrative procedures, and accelerating digital transformation in tax administration, particularly in key areas such as land-related revenues, real estate transfers, e-commerce, and digital platform-based business activities.

Gia Nghi

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