Minh Viễn wrote this Vietnamese article, published in Luật Khoa Magazine on June 20, 2025.
A new government policy is forcing small businesses across Việt Nam to overhaul their operations, and it follows a familiar pattern of “ambush policymaking” that leaves citizens scrambling to keep up.
This scenario is reminiscent of Decree 168, a regulation issued on Dec. 26, 2024, that sharply increased traffic violation penalties. The public was given only six days to prepare before it took effect on Jan. 1, 2025. The short gap between signing and enforcement left people confused and unprepared, leading to unintentional violations and widespread frustration, which was only fueled by malfunctioning traffic signals and a lack of state readiness.
Now, a similar issue is unfolding nationwide—not on city streets but in markets, small shops, and vendor stalls.
Abolishing Flat-Rate Taxes
On May 4, 2025, the Politburo issued Resolution 68-NQ/TW, ordering the end of the flat-rate tax system—a model used by small businesses for over 30 years. Just 14 days later, on May 17, the National Assembly passed Resolution 198/2025/QH15, officially abolishing the system as of June 1, 2025.
At the same time, the government issued Decree 70/2025/NĐ-CP, mandating that any business with annual revenue over 1 billion đồng must now use electronic invoices connected directly to the tax authority. While the rules for smaller businesses are not yet official, the General Department of Taxation has already instructed localities to review and collect back taxes from unregistered vendors, raising concerns about whether any small business is truly exempt.
Vendors Thrown into Chaos
All these policies share a near-total lack of preparation time for the public, especially for the small vendors and microbusinesses who are least equipped to handle the changes. According to the General Department of Taxation, over three million household businesses that previously used the simple flat-rate tax model were expected to overhaul their business models, mindsets, and tools in less than 30 days.
Vendors who sold goods on the sidewalk or ran a small stall without proper accounting and bookkeeping are now expected to master e-invoicing and tax law. “To comply with the new rules, I had to invest in a system like those in supermarkets—computer, label printer, invoice printer, barcode scanner—costing over 40 million đồng, not to mention the price of a digital signature,” one vendor shared.
Additionally, training provided by the government has been widely criticized as inadequate. According to a report in Tuổi Trẻ newspaper, vendors who attended training sessions found the content overly technical and presented by banks and software companies, with no clear, practical guidance for their real-world scenarios.
Pháp Luật Thành phố Hồ Chí Minh, a newspaper, reported the same situation at Bến Thành Market, where over 600 vendors were left confused and struggling with the new e-invoicing requirement. The market’s own management admitted, “Many vendors, especially older ones accustomed to traditional methods, were confused and lacked IT skills for the transition. They need more time and step-by-step assistance.”
Good Intentions, Flawed Execution
While the goal of greater tax transparency is valid, the core issue is not the policy’s aim, but its execution. People need time, a clear roadmap, and real support. Instead of a well-planned transition, small business owners are being thrown into the digital deep end without a life vest.
This raises critical questions for policymakers: Who gets left behind when policy is pushed out this fast? And perhaps more importantly, has the government forgotten that tax compliance is not just about numbers—it is about people’s right to fair access to information, technology, and adequate time to adapt?
