Income tax cut object 1: Businesses that have revenue in 2021 is lower than in 2019

The National Assembly Standing Committee prescribed Resolution No. 406/NQ-UBTVQH15 dated October 19, 2021, and the Government published Resolution No. 92/2021/ND-CP dated October 27, 2021, were two of the most noticeable decisions during the tax finalization of 2021. Enterprises with lesser revenue in 2021 than in 2019 will be eligible for a 30% tax relief in the amount of CIT payable in 2021. This provision, however, will not apply to taxpayers that are newly constituted, consolidated, merged, divided, or separated during the final settlement in 2020 and 2021.


Companies eligible for the tax reduction policy include Cat Lai Port Joint Stock Company (HOSE: code CLL), whose revenue in 2021 was 264 billion VND, which declined by approximately 25% compared to the same period in 2019, and Central Pharmaceutical Joint Stock 3 Company (HNX: code DP3), whose revenue in 2021 was VND 394 billion, which declined by 7% compared to the same period in 2019.


There are more than 1,900 enterprises that are listed on the stock exchange. These businesses, together with unlisted public corporations, are the only ones that can be utilized as evidence to determine whether or not the CIT reduction strategy should be implemented. However, it is necessary to evaluate the data of more than 2 million unlisted companies operating in the territory of Vietnam to have a comprehensive understanding of the market and to assess the value that the tax reduction program provides.


Enterprises are currently occupied with the tax finalization to finish the consolidated financial statements for 2021. Consequently, VIRAC has been unable to provide an actual study and statistical figure for the quantity of objective no.1 in the reduction policy. Nevertheless, VIRAC’s research and analysis of the enterprise market in 2020 revealed that up to 35% of enterprises would see a decrease in revenue in 2020 when compared to the same period the previous year. This figure also helps to forecast the number of enterprises that continue to lose revenue compared to 2019, which can benefit from this tax exemption and reduction policy.

Income tax cut object 2: Small and medium-sized enterprises (SMEs) with revenues that are less than or equivalent to VND 200 billion (US$8.8 million) in 2021.

Significantly, small and mid-size enterprises (SMEs) with a turnover of less than or equal to VND 200 billion in the tax finalization 2021 are also eligible for the 30% tax relief in CIT, according to Resolution No. 406/NQ-UBTVQH15 and Decree 92/2021/ND-CP.

Some listed businesses whose stocks are of high interest to investors will profit from this CIT reduction policy. Some of the noticeable companies are Hanoi Liquor And Beverage JSC (UPCoM: code HNR) with a revenue of 112 billion VND in 2021; Beer – Alcohol – Beverage Packaging JSC (UPCoM: code BAL) with 62 billion VND; or Dam Sen Water Park Corporation (HOSE: code DSN) with a revenue of only VND 25 billion, etc.


According to the VIRAC research reports, more than 95% of enterprises, including publicly traded and privately held, had a turnover of less than or equal to 200 billion VND by 2020. In the tough year of 2021, VIRAC predicted that the different numbers of these objects would be very tiny or inconsequential.



The outbreak of the COVID-19 pandemic has caused unprecedented obstacles and issues for businesses’ production and trading activities. In 2021, the number of start-up businesses and investments declined considerably, to 160,000 enterprises. Meanwhile, the number of businesses leaving the Vietnamese market has been roughly 10,000 each month, which increased by 17.8 percent over the previous year (according to the General Statistics Office – GSO). As a result, the government’s timely support for tax rate reductions might be seen as contributing to a reduction in the financial burden and strain on businesses.


The 30% tax relief on corporate income policy benefits not only listed firms but also non-listed companies. According to VIRAC data on Vietnamese enterprises, public companies account for only about 0.3% of those that issue financial statements.


With over 6 years of experience, VIRAC has supported and been trusted by many domestic and foreign clients in a variety of industries, including finance – banking, securities, consulting, investment, mergers and acquisitions, FDI firms with foreign capital, and so on. VIRAC is confident to accompany and support your businesses in providing reliable market research – company research information, assisting in the assessment of potential partners, and aiding your company in the planning and decision-making processes




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