Key Points of Resolution 68 on Private Sector Development in Vietnam

Following nearly forty years of economic reforms, particularly during the period of extensive international integration and openness, Vietnam’s private sector has emerged as a dynamic force. From a modest economic component, the private sector has grown exponentially in scale, quantity, and quality, significantly contributing to GDP, employment generation, and innovation. On May 4, 2025, the Politburo issued Resolution 68 on Private Sector Development, which is expected to mark a historic turning point, ushering in a breakthrough era for this vibrant economic sector while reaffirming its indispensable role in national construction and development. Hereinafter, Viet An Law presents key points of Resolution 68 on private sector development in Vietnam.

Development goals for the private sector under Resolution 68

By 2030

• The private sector shall become the primary driving force of the national economy, spearheading scientific and technological advancement, innovation, and digital transformation, thereby contributing to the successful implementation of Politburo Resolution No. 57-NQ/TW (December 22, 2024) and other party policies.
• With targets of 2 million active enterprises (20 enterprises per 1,000 people). And at least 20 large enterprises are integrated into global value chains.
• Annual growth rate of 10–12%, exceeding the national GDP growth rate; contribution of 55–58% to GDP, 35–40% to state budget revenue, and employment for 84–85% of the workforce; labor productivity growth averaging 8.5–9.5% annually.
• Technological capacity, innovation, and digital transformation rank among the top 3 in ASEAN and top 5 in Asia.

Vision for 2045

Vietnam’s private sector shall achieve rapid, sustainable, and competitive growth, actively participating in global supply chains. By 2045, the sector aims to sustain at least 3 million enterprises and contribute over 60% of GDP.

Key points of resolution 68 on private sector development in Vietnam

Abolition of the fixed tax regime for household businesses no later than the end of 2026

In Resolution 68-NQ/TW, the Politburo mandates a comprehensive review and enhancement of the legal framework governing individual business households, to minimize regulatory disparities and create optimal conditions for governance structures and financial reporting/accounting regimes applicable to micro-, small-, and household businesses. The Resolution emphasizes digital transformation to streamline tax compliance, accounting procedures, and insurance regimes, thereby incentivizing the formalization of household businesses into corporate entities.

Specially, the abolition of the fixed tax regime for household businesses no later than the end of 2026.

According to data from the Tax Department (Ministry of Finance), as of the end of March 2025, there were 1,975,373 business households filing taxes under the fixed tax regime, while only 6,142 households filed under the declarative method.

Historically, tax administration for business households has predominantly relied on the fixed tax method, where tax authorities assign a fixed annual revenue threshold, and households pay taxes based on this predetermined amount. The advantage of this method lies in its simplicity and ease of implementation, making it suitable for businesses with limited management capacity.

However, the fixed tax regime also exhibits significant disadvantages, including:

• Lack of revenue transparency incentives, as households may underreport actual revenue to reduce their tax liability;
• Challenges for tax authorities in revenue monitoring, leading to potential budget shortfalls;
• Inequity among business households, where some with higher actual revenue may pay less tax than those with lower revenue but higher fixed thresholds.

The abolition of the fixed tax regime is expected to revolutionize tax administration by enhancing income and cost transparency; ensuring equitable tax compliance across business types and mitigating tax revenue leakage…

Providing free services for micro, small, and household businesses

One of the most substantive and effective support policies for micro, small, and household businesses is the “provision of free digital platforms, shared accounting software, legal advisory services, and training programs in business management, accounting, taxation, human resources, and legal compliance for micro/small enterprises and individual business households”.

This policy aims to reduce operational costs; enhance management capacity; facilitate technology adoption for disadvantaged enterprises that typically lack capital, specialized personnel, and resources to afford professional services like larger corporations.

• Short-term: Lowers operating expenses, improves legal compliance, and enables access to formal markets.
• Long-term: Incentivizes the formalization of household businesses into registered enterprises, drives digital economic growth, and enhances the private sector’s competitiveness and transparency.

Reduction of administrative intervention and barriers

To accelerate institutional reforms and enhance the quality of policies for the private sector, Resolution 68 emphasizes:

“Minimizing administrative interference and eliminating bureaucratic barriers, the ‘petition-grant’ mechanism, and the mindset of ‘banning what cannot be controlled.” Citizens and businesses are free to operate in any trade or profession not prohibited by law”.

The Resolution marks a significant shift in policymaking for the private sector, with the following objectives:

• Upholding the freedom of enterprise for citizens and businesses.
• Recognizing the autonomy of individuals/enterprises instead of requiring them to “seek permission”.
• Reducing administrative intervention, eliminating arbitrary prohibitions, and curbing corruption.
• Operating the economy under market mechanisms with a socialist orientation through appropriate regulatory tools.

Streamlining of business licensing requirements

Resolution 68 emphasizes: “In 2025, complete the review and elimination of unnecessary, overlapping, or outdated business requirements that hinder private sector development; reduce administrative procedure processing time by at least 30%, cut compliance costs by at least 30%, and remove at least 30% of business conditions, with further significant reductions in subsequent years. Vigorously implement cross-jurisdictional public services for enterprises”.

Currently, many business regulations remain procedural, excessively interfering with internal corporate operations, and incur costly and time-consuming administrative complexities. Resolution 68 advocates for:

• Streamlining and eliminating redundant business conditions: Removing legal barriers to foster a transparent business environment, promote entrepreneurship, and ensure fair competition. This helps purify the regulatory landscape, curbing the “petition-grant” mechanism and administrative harassment.
• 30% reductions in administrative processing time, compliance costs, and business requirements: Enables enterprises to save time and resources for core operations, minimizes bureaucratic obstacles and corruption risks in licensing/legal compliance, and enhances private sector competitiveness, especially for micro and small businesses.
• Borderless public services: Marks a transition toward a “digital government” model, facilitating operations for multi-location or virtual enterprises through data integration and paperless procedures.

Decriminalization of private sector economic activities

Resolution 68 emphasizes amendments to criminal, civil, and procedural laws to ensure the principle of prioritizing economic-civil and administrative measures when handling violations and economic-civil cases. This allows businesses and entrepreneurs to proactively remedy violations and damages. Specifically:

• In cases where legal application could lead to either criminal or non-criminal outcomes, criminal penalties must be strictly avoided.
• If criminal liability is unavoidable, prioritize economic remedial measures as the first recourse, which shall serve as a key consideration for determining subsequent actions.
• Legal provisions shall not be applied retroactively to the detriment of enterprises. Cases lacking clear or sufficient evidence must be promptly concluded to avoid harming the reputation and normal operations of businesses and entrepreneurs.
• The principle of presumption of innocence must be strictly upheld throughout investigation and adjudication.

This policy reflects the spirit of Resolution 66-NQ/TW on Legal System Reforms, which states:

“Do not criminalize economic, administrative, or civil relations; refrain from using administrative measures to intervene in civil or economic disputes”.

Thus, the policy adopts a clear, protective approach toward entrepreneurs while ensuring no tolerance for deliberate legal violations.

The above highlights the key points of Resolution 68 on private sector development in Vietnam. If you have any further questions related inquiries or require legal procedure consultation for your business, please contact Viet An Law for specific legal consultation!