The government has recently issued Decree No. 117/2025/ND-CP regulating the tax administration of business activities conducted on e-commerce platforms by business individuals and households.
Organizations that manage e-commerce platforms and digital platforms with payment functions (“managing organizations”) and “organizations with other digital economic activities” are responsible for deducting and paying taxes, including value-added tax (VAT) and personal income tax (PIT), on behalf of business individuals and households operating on such e-commerce platforms and digital platforms. Note that the tax administration for business activities conducted on digital platforms with payment functions differ from those without payment functions.
Managing organizations include the owner directly managing such platforms or the person authorized to manage such platforms, which are set up for buyers to make direct payments through methods such as e-wallets, bank cards/payments, transfers via payment accounts, integrated transfer systems, cash on delivery and other payment methods as prescribed by law.
“Organizations with other digital economic activities” are organizations in Vietnam that, on behalf of an e-commerce platform provider or a foreign digital platform, make income payments to business households and individuals earning from digital information content (e.g. products and services) in accordance with the Law on Information Technology.
Managing organizations of e-commerce platforms must withhold and pay the tax on behalf of the following taxpayers:
- VAT payable on revenue generated on each domestic sale of goods and services for households and individuals operating on e-commerce platforms; and
- PIT payable on revenue generated on each sale, domestic or overseas, of goods and services for residents doing business on e-commerce platforms, or each domestic sale for non-residents doing business on e-commerce platforms.
The deduction of taxes must be made as soon as the transaction is confirmed and payment is accepted.
Households and resident individuals doing business on e-commerce platforms without direct payment functions must declare and pay VAT, PIT, special consumption tax, environmental protection tax, resource tax and other revenues payable directly to the relevant local tax authority. Households and resident individuals with business activities on e-commerce platforms must declare the tax monthly, while households and resident individuals with irregular business activities on e-commerce platforms must declare on each occurrence.
Non-resident individuals conducting business activities on e-commerce platforms without direct payment functions must electronically pay VAT and PIT on goods and services traded on e-commerce platforms directly to the e-commerce Tax Department on each occurrence.
VAT and PIT will be calculated on and deducted from the revenue on each transaction.
The rates, pursuant to the VAT Law and PIT Law, are set out in the table below. Business activities VAT rate (%) PIT rate for residents (%) PIT rate for non-residents (%) Sale of goods 1% 0.5 1 Provision of service 5% 2 5 Transportation services, and services associated with goods 3% 1.5 2
The Decree of 9 June 2025 will take effect on 1 July 2025 and is anticipated to significantly impact both domestic and cross-border e-commerce operations in Vietnam. The full text is available on the government’s website (available as a PDF and in Vietnamese only).
