1) Tiered CIT rates – Real relief for SMEs

Meaning: the smaller the business, the lower the burden – more room for reinvestment.

Note: Not applicable to subsidiaries or linked companies failing conditions. Newly established firms converted from household businesses enjoy 2 years of CIT exemption.

2) Strong incentives for strategic sectors

• High-tech, digital economy, semiconductors, AI → 10% for 15 years; 4-year exemption; 50% reduction for next 9 years.
• Agriculture, forestry, fisheries → 10% (or 15% if outside incentive zones).
• Renewable energy, manufacturing, environment → 10% for 15 years.
• Key infrastructure, social housing → 10%.
• Education, healthcare, press, publishing → 10%.

3) Tighter taxation on digital economy & foreign suppliers

• Foreign enterprises without permanent establishments in VN (e-commerce, digital platforms) still subject to CIT.
• Definition of “permanent establishment” broadened to include digital platforms.
• Aim: create fairer competition between domestic and cross-border businesses.

4) Flexible transition provisions

• Enterprises can choose to apply incentives per original investment license or under the new Law (if eligible).
• If previously ineligible but now qualified under the new Law, incentives apply from tax year 2025 onwards for the remaining term.

✅ What should businesses do now?

• Review 2024 revenue to determine CIT tier (15%–17%–20%).
• Check if your sector falls under new incentives (AI, semiconductors, green energy…).
• Review contracts with foreign suppliers → avoid risk of being deemed a “permanent establishment”.
• Compare current license with new Law to select the most beneficial regime.
• Prepare CIT planning for 2025 early.