Businesses and consumers benefit together
After 6 months of Decree No. 174/2025/ND-CP on the policy of reducing value-added tax officially being implemented, this policy has gradually become practical in the context of the economy finding more growth momentum.
Reducing the VAT rate from 10% to 8% for many groups of goods and services is considered an important fiscal solution, contributing to reducing costs for businesses, stimulating market purchasing power and creating more momentum for economic growth.
As a business producing consumer electronic products serving the global market, Ms. Bui Yen Chi - representative of Horn Vietnam Co., Ltd. (An Duong, Hai Phong) said that enjoying a 0% tax rate applied to exported goods helps businesses have more competitive advantages in the market.
Ms. Chi added that the VAT exemption and reduction policy has had a positive impact on taxes related to import and export activities. In particular, for products exported to international markets such as the US in the past, tax exemption and reduction have created more incentives and significant support for businesses.
The first benefit that can be mentioned is the cost of the product, followed by the profit for the company. The additional profit is equivalent to the VAT exemption and reduction level" - Ms. Chi said.
According to Ms. Chi, for businesses, especially foreign-invested businesses in Vietnam, tax policies have now received great support from the Government. Representatives of Horn Vietnam Co., Ltd. said that taxes are no longer the biggest problem for businesses, but the main difficulty lies in the human resource problem, how to meet enough labor for production activities.
Ms. Chi also pointed out the positive improvements in personal income tax policy, thereby directly supporting workers.
When workers have increased real income after tax, in addition to salaries, the demand for spending in the market will be stimulated. At the same time, income levels with more incentives also help businesses more conveniently recruit, thereby serving production activities well" - Ms. Chi expressed.
As for businesses operating in the field of marine engine repair, Mr. Mai The Trong - founder of MTB Technical Services Co., Ltd. (Duong Kinh, Hai Phong) said that reducing VAT from 10% to 8% helps businesses reduce input costs. Thanks to that, service costs are reduced, bringing direct benefits to ship owners and customers.
According to Mr. Trong, the 2% reduction is not large enough for businesses to immediately expand investment and innovate equipment. However, this is still timely encouragement and support in the context that businesses are facing many difficulties.
From the reality of production and business activities, Mr. Trong hopes that the Government will continue to maintain the VAT reduction policy in the coming time, thereby creating more conditions for businesses to recover after the pandemic and recent economic fluctuations.
2 prerequisites
Talking to reporters, Dr. Nguyen Minh Phong - Former Head of the Economic Research Department, Hanoi Institute for Socio-Economic Development Studies, said that there is currently no official report to assess the positive or negative impacts of the VAT reduction policy when it is widely applied at 8%. However, in terms of logic and practice, 2 important impacts can be clearly seen.
First, the 2% VAT reduction policy may reduce budget revenue in the short term, which is inevitable. However, this reduction is completely compensable when the total output of the economy increases, leading to expanded consumption activities, thereby increasing the scale of revenue.
In other words, instead of collecting 10% on a small "number sample", collecting 8% on a larger "number sample", total budget revenue may still be higher" - Dr. Nguyen Minh Phong affirmed.
Second, the more important impact, the VAT reduction policy simultaneously stimulates both consumer demand and production supply. When both businesses and people benefit from tax reduction, production and business activities are promoted, consumption increases. Thereby, creating momentum for economic growth and activating other investment and consumption activities, forming a foundation for future growth.
The GDP growth rate of over 8% this year is an example showing that the positive impact, although not entirely direct, can clearly show the connection and there is a complete basis for explanation" - Mr. Phong said.
In addition, Dr. Nguyen Minh Phong emphasized the need to continue to expand tax incentives for key sectors such as information technology, digital transformation and green transformation - important drivers for long-term growth. However, Mr. Phong emphasized, clearly defining the scope of "substantial green" to avoid spreading policies.
