Entities Subject to Value-Added Tax (VAT) Under the 2024 VAT Law

From July 1, 2025, entities required to pay Value-Added Tax (VAT) under Article 4 of the 2024 VAT Law include:

(1) Organizations, households, and individuals engaged in the production and business of goods and services subject to VAT (referred to as business establishments).

(2) Organizations and individuals importing goods subject to VAT (referred to as importers).

(3) Organizations and individuals in Vietnam purchasing services (including services related to goods) from foreign organizations without a permanent establishment in Vietnam or from non-resident individuals, except for specific exempt cases as stipulated by law. Additionally, organizations engaged in production and business activities in Vietnam must pay VAT when purchasing goods and services for oil and gas exploration, development, and extraction from foreign organizations and individuals without a permanent establishment in Vietnam.

(4) Foreign suppliers without a permanent establishment in Vietnam who conduct e-commerce or digital platform-based business activities with organizations and individuals in Vietnam (referred to as foreign suppliers).

Foreign digital platform operators are responsible for withholding and remitting VAT on behalf of foreign suppliers.

(5) Operators of e-commerce marketplaces or digital platforms with payment functions are required to withhold and declare VAT on behalf of business households and individuals conducting business through their platforms.

Compared to the previous VAT Law, the 2024 VAT Law introduces significant changes in tax obligations for cross-border transactions, particularly those conducted through digital platforms and e-commerce. These changes aim to enhance tax control over transactions without a physical presence in Vietnam, aligning with the global digital economy's development.