Dear Clients and Partners,
As we move through the second half of 2026, the regulatory landscape in Vietnam has undergone a significant transformation. For businesses operating within the region: from local enterprises to foreign-invested multinationals: staying ahead of these shifts is no longer just a matter of "best practice"; it is a fundamental requirement for operational continuity and financial health.
At BLaw Vietnam, we have spent years perfecting our "Clockwork" internal systems to ensure that our clients transition through these legislative changes with zero friction. Whether you are navigating the intricacies of the new Personal Income Tax (PIT) Law or aligning your board with the 2026 Corporate Governance Code, our mission remains the same: to provide excellence and high-level tax optimization strategies that empower your growth.
Through this article, we will detail the pivotal updates effective this year and provide actionable steps to ensure your business remains compliant and competitive in the 2026 Vietnamese market.
1. The New Era of Personal Income Tax (PIT) Law 109/2025/QH15
One of the most profound changes this year is the full implementation of the New Personal Income Tax (PIT) Law (109/2025/QH15), which officially took effect on July 1, 2026. This law represents the first major overhaul of the PIT system in nearly two decades, aiming to simplify tax administration while easing the burden on mid-to-high-income earners.
Key Changes to Tax Brackets
The previous seven-level progressive tax system has been streamlined into a five-level bracket. This change is designed to enhance administrative efficiency and provide more clarity for payroll departments. The new monthly thresholds are as follows:
- Up to VND 10 million: 5%
- Over VND 10 million to 30 million: 10%
- Over VND 30 million to 60 million: 20%
- Over VND 60 million to 100 million: 30%
- Over VND 100 million: 35%
Enhanced Deductions and Exemptions
To account for the rising cost of living, the 2026 framework has significantly increased family-circumstance deductions. The personal deduction has risen from 11 million to 15.5 million VND/month, while the dependent deduction has been adjusted to 6.2 million VND/month per dependent.
Furthermore, the law now recognizes 21 categories of tax-exempt income (up from 14). Notably, wages for night work, overtime pay, and remuneration for unused statutory annual leave are now potentially tax-exempt under specific conditions. For businesses, this offers a unique opportunity for tax optimization by restructuring compensation packages to benefit both the employee and the employer.
If your business is currently reviewing its 2026/2027 payroll structure, our Tax Settlement Services can help you navigate these new brackets and maximize available exemptions.
2. Navigating the Global Minimum Tax (GMT) Regime
For multinational enterprise (MNE) groups, 2026 is a critical "safe harbor" year. Following the adoption of National Assembly Resolution 107/2023/QH15 and the subsequent Decree No. 236/2025/ND-CP, Vietnam has firmly integrated the Global Minimum Tax into its corporate income tax regime.
The 17% Safe Harbor Threshold
As we navigate the 2026 fiscal year, large MNEs with consolidated revenue exceeding EUR 750 million must pay close attention to the transitional safe harbor rules. For FY2026, the simplified effective tax rate threshold is set at 17%. If your group's effective tax rate in Vietnam falls below this, a top-up tax may be triggered under the Income Inclusion Rule (IIR) or the Qualified Domestic Minimum Top-Up Tax (QDMTT).
Strategic Action for MNEs
We recommend that financial directors and compliance officers:
- Conduct a Gap Analysis: Compare your current effective tax rate against the 17% threshold for 2026.
- Review Documentation: Ensure that Country-by-Country Reporting (CbCR) and transfer pricing documentation are meticulously maintained as per the latest requirements of Decree 236.
- Optimize Incentives: Re-evaluate existing tax incentives (such as tax holidays or preferential rates) to see how they interact with the GMT.
3. Employment Law Vietnam: Modernizing Labor Relations
Compliance with employment law in Vietnam has become more sophisticated in 2026. The phased increase in the retirement age continues its progression, and new amendments to the Labor Code have granted both parties broader rights regarding contract termination.
Unilateral Termination Rights
Employers now have more clearly defined rights to unilaterally terminate labor contracts if an employee provides false information during the hiring process or seriously breaches internal labor regulations. Conversely, protection for employees has also been strengthened, requiring businesses to maintain impeccable records and follow strict "Clockwork" procedures during any disciplinary or termination process to avoid costly litigation.
Wage and Social Insurance Adjustments
The 2026 minimum wage increase under Decree 293 has triggered a ripple effect across the social insurance landscape. HR departments must ensure that the maximum salary base for unemployment and social insurance contributions is adjusted correctly. Failure to do so can lead to administrative fines and complications during annual audits.
Our Employment and Labor Law experts provide the counsel needed to draft compliant contracts and manage labor disputes effectively.
4. Corporate Governance & The 2026 Code: A Focus on ESG
In February 2026, the State Securities Commission launched the Vietnam Corporate Governance Code 2026. This updated code places an unprecedented emphasis on Environmental, Social, and Governance (ESG) factors.
Integrating ESG into Strategy
Boards of directors are now expected to embed ESG metrics directly into their corporate strategy and risk management frameworks. This is no longer just for listed companies; private enterprises looking for international investment or M&A support are increasingly being scrutinized on their governance standards.
Key focus areas for 2026 governance include:
- Board Diversity and Independence: Ensuring a balanced board composition.
- Transparency in Non-Financial Reporting: Disclosing climate impact and social responsibility metrics.
- Debt Recovery Systems: Implementing ethical and efficient Debt Recovery Services to protect cash flow while maintaining corporate reputation.
5. Why Partner with BLaw Vietnam?
At BLaw Vietnam, we believe that legal services should be a catalyst for business growth, not a bottleneck. Our attorneys are not just legal advisors; they are strategic partners who understand the nuances of the Vietnamese market.
Our "Clockwork" Commitment
We utilize a rigorous internal operational system to guarantee quality:
- Excellence: Every legal opinion undergoes a multi-tier review process by our Senior Heads of Advisory.
- Client Focus: We tailor our advice to your specific industry, whether you are in manufacturing, digital services, or high-tech.
- Knowledgeable Attorneys: Our team stays ahead of the curve, as evidenced by our deep dive into the 2026 legislative updates.
Whether you are seeking Corporate Governance advice to align with the new 2026 Code or need assistance with Copyright Law for your digital assets, we have the expertise to guide you.
Conclusion
The 2026 legal and tax updates in Vietnam represent a maturing economy that prioritizes transparency, simplicity, and global integration. While these changes may seem complex, they offer significant opportunities for businesses that are proactive in their compliance and optimization strategies.
In addition to the tax and labor updates mentioned, we encourage all business owners to review their corporate structures and intellectual property portfolios to ensure they are fully protected under the current framework.
Are you ready to optimize your business for the 2026 legal landscape?
We invite you to reach out to our team of experts for a comprehensive compliance health check. Let BLaw Vietnam help you turn legal complexity into a competitive advantage.
Contact us today at blawvn.com to schedule a consultation.
