At the regular Government meeting on August 3, Prime Minister Le Minh Hung assigned the Ministry of Finance to propose tax measures to promote production and business, especially for small and medium-sized enterprises, individuals, and business households. The Ministry of Finance is assigned to soon study and report to the National Assembly to amend the Law on Corporate Income Tax in the direction of reducing taxes for this group, applied immediately in 2026.
In addition, the Prime Minister requested to study the addition of individuals and business households to the scope of regulation of the draft Law on Small and Medium Enterprise Development, thereby creating a mechanism to encourage business households to transform into enterprises, especially the one-person enterprise model.
The above policy is assessed by many small businesses and business households as a positive signal. However, according to many opinions, for policies to be effective, it is not only necessary to reduce taxes but also to be designed more closely to the actual operation of each group of subjects.
Proposal to apply tax policies according to operating scale
Doing restaurant business in Hanoi, Mr. Duc Thinh (43 years old) said that his family's business earns about 5 billion VND per year. However, most of the revenue is used to pay for land rent, employee salaries, raw materials, electricity and water, transportation costs, bank loan interest and many other operating costs. After deducting expenses and tax obligations, the actual profit is still very low, even at times losing money when input costs increase or purchasing power declines.
I hope the State will consider raising the tax-exempt revenue threshold for business households, and at the same time study reducing interest rates and taxes so that business households and small businesses have more resources to maintain and expand production and business," Mr. Thinh proposed.
From a business perspective, Mr. Pham Quang Huy, Director of a mechanical enterprise in Cau Giay district (Hanoi), said that the policy of studying tax reduction for small and medium-sized enterprises is a positive sign, because this is a group of enterprises facing a lot of pressure on capital, costs and competitiveness.
According to Mr. Huy, micro-enterprises, although with limited capital and labor, still have to bear many fixed costs and compliance costs. Therefore, he proposed to study applying a corporate income tax rate of about 10% for businesses with revenue below 15 billion VND/year instead of applying it generally as at present.
If taxes are reduced, businesses will have more resources to reinvest, recruit labor and expand production. When small businesses develop stably, it will create a spillover effect to the supply chain, jobs and consumption. I expect the Government's policy to be concretized soon so that businesses reduce pressure," Mr. Huy expressed.
Need to remove obstacles related to costs and tax procedures
Meanwhile, Mr. Nguyen Van Hai, Director of a construction material business in Hanoi, said that for micro enterprises that only achieve a profit of about 300 million VND per year, the State should consider exempting corporate income tax for a certain period of time to create conditions for capital accumulation and scale expansion.
Mr. Hai also said that one of the major difficulties of micro-enterprises today is the collection of documents for expenses incurred during operation.
A team of construction workers in the province incurs daily expenses for food, travel, accommodation and many other small expenses. These are all actual expenses, but collecting full invoices and documents according to regulations is not always possible. When some expenses are not included in the deductible expenses, taxable income will be higher than reality, increasing the tax obligations of businesses," Mr. Hai said.
According to him, along with studying tax reduction, management agencies also need to continue to review regulations on deductible costs and document procedures for micro enterprises, ensuring both strict management and conformity with production and business practices.
Policy design according to industry specifics
From the experience of consulting for many small and medium-sized enterprises, Mr. Nguyen Thanh Trung, Director of a tax accounting consulting company in Hanoi, said that revenue does not fully reflect the scale or operational efficiency of the enterprise.
According to Mr. Trung, many export enterprises have revenue of up to tens, even hundreds of billions of VND per year, but the profit margin is very low due to the large value of goods, dependence heavily on bank loans and risks from logistics cost fluctuations.
A container of agricultural products is worth from 4-5 billion VND, most businesses have to borrow capital to purchase raw materials. As soon as sea transportation costs increase sharply or the market fluctuates, profits can decrease very sharply, even to 0 or negative. Therefore, if only relying on revenue to assess business scale or build tax policies, it will not accurately reflect the nature of the operations of many exporting enterprises," Mr. Trung analyzed.
According to Mr. Trung, small and medium-sized export enterprises still need more tax support policies to improve competitiveness.
Many countries in the region have preferential mechanisms for export businesses because this is an area that brings foreign currency to the economy. Vietnam should also study more appropriate policies for agricultural export businesses, thereby creating conditions for businesses to expand markets and bring more Vietnamese agricultural products abroad," Mr. Trung proposed.
