Special Consumption Tax Law 2025: New Rules & Excise Updates in Vietnam

The Law on Special Consumption Tax 2025 was issued in the context of Vietnam’s economy entering a period of fiscal policy adjustment towards sustainability, transparency, and conformity with international integration commitments. With many important amendments and supplements, the Law not only aims to perfect the legal framework on special consumption tax but also aims to orient healthy production – consumption, control items having great impact on community health, the environment, and social order. Grasping the new contents of the Special Consumption Tax Law 2025 will help enterprises and taxpayers proactively comply with legal regulations, and simultaneously build appropriate business strategies in the coming period. In the article below, Viet An Law Firm will point out the new and outstanding points in this new tax Law.

Special Consumption Tax Law 2025: New Rules & Excise Updates in Vietnam

• The Law on Special Consumption Tax of 2025 (Law No. 66/2025/QH15) was passed by the National Assembly on June 14, 2025, and officially came into effect on January 1, 2026, replacing the Law on Special Consumption Tax of 2008 and Law No. 70/2014/QH13. The new law comprises 4 chapters and 11 articles, with many important amendments and additions.
• The promulgation of the new Law on Special Consumption Tax aims to adjust tax policies in a more rational and appropriate manner to socio-economic realities, contributing to increased revenue for the state budget. At the same time, the law continues to promote the role of taxation as a tool in guiding and regulating consumption of goods that have a negative impact on public health and the environment.
• Furthermore, the new law is designed to address the difficulties arising from the application of the Special Consumption Tax Law in the past, resolving inadequacies and overlaps, and ensuring consistency and uniformity with related legal systems. The law also aims to reform tax management procedures towards simplification, clarity, and transparency, creating favorable conditions for taxpayers to comply with the law and fulfill their tax obligations fully, on time, and promptly to the state budget.

Some new points of the Law on Special Consumption Tax 2025

Expanding the scope of taxable subjects (Article 2)

• Article 2 of the new Law adjusts the scope of taxable items by adding several taxable items compared to previous regulations (Consumption Tax Law No. 2008, amended 2024), including:
  • Helicopters and gliders;
  • Beverages meeting National Standards with a sugar content exceeding 5g/100mL;
• Air conditioners are now only subject to tax if their capacity is between 24,000 BTU and 90,000 BTU, narrowing the taxable scope compared to before;
• Paper offerings, votive items (excluding toys and teaching aids), and gambling businesses are clearly defined as taxable items.

Thus, it can be seen that expanding the tax base in the new Law reflects a selective approach to regulating consumption, in line with socio-economic realities, while contributing to protecting public health, the environment, and increasing sustainable revenue for the state budget.

Expanding the scope of tax-exempt items (Article 3)

The 2025 Law adds many more cases exempt from excise tax, such as:

• Goods processed for export, and returned exported goods;
• Automobiles and vehicles operating within limited areas such as historical sites, hospitals, and schools;
• Helicopters and gliders used for rescue, relief, and training;
• Regulations on tax payment responsibility if re-export/re-import deadlines are exceeded.
• A flexible mechanism allows the Government to submit proposals to the National Assembly Standing Committee to adjust the tax-exempt items according to the socio-economic situation.

Meanwhile, the 2008 Excise Tax Law, amended in 2014, only stipulated tax exemptions for exported goods, temporarily imported and re-exported goods, tax-exempt items, ambulances, or specialized vehicles based on certain old criteria, and has not been expanded as in the new law.

Expanding the scope of tax-exempt items in the new Law contributes to resolving practical difficulties, ensuring the rationality and flexibility of tax policy, while creating favorable conditions for production and business activities and being more in line with the objectives of state management in each period.

Addition of the method for calculating absolute tax (Article 5)

This is a completely new point in the 2025 Law. Previously, the 2008 Special Consumption Tax Law only stipulated that: The basis for calculating special consumption tax is the taxable price of taxable goods and services and the tax rate. The amount of special consumption tax payable is equal to the taxable price multiplied by the special consumption tax rate.

The 2025 Law stipulates two methods for calculating special consumption tax:

• Calculated as a percentage (%) based on the taxable price and tax rate.
• Calculated as an absolute tax rate based on the quantity of taxable goods and a fixed tax rate.

This creates a more flexible tool for tax management and aligns with international trends. At the same time, it enhances the efficiency of consumption regulation and increases the stability and transparency of state budget revenue.

Tobacco tax – implemented strictly according to a schedule (Article 8)

Special Consumption Tax Law 2025 for the first time stipulates the application of an absolute tax on tobacco products, in addition to the percentage-based tax rate. Accordingly, cigarettes, cigars, and other tobacco products will be subject to an absolute tax rate specifically determined in stages, with a gradual increase from 2027 to 2031. Specifically:

• Cigarettes: from 2,000 VND/pack (2027) to 10,000 VND/pack (2031);
• Cigars, pipe tobacco, chewing tobacco… also have corresponding increases each year.

Previously, the old law mainly calculated the excise tax on tobacco based on a percentage (%) of the tax rate without a mandatory absolute tax bracket.

The new regulations help address the situation where businesses adjust selling prices or taxable prices to a lower level in order to reduce their tax obligations. In addition, it contributes to controlling the consumption of products harmful to health, ensuring stable budget revenue, and aligning with modern tax management trends worldwide.

Increase tax rates on alcohol and beer according to a schedule (Article 8)

The 2025 law increases tax rates on:

• Alcohol ≥ 20%: from 65% (2026) to 90% (2031).
• Alcohol < 20% and beer will also gradually increase according to the roadmap to 2031.

The old law only had fixed tax rates (or increased periodically through amendments) but lacked a clear long-term roadmap like the new law.

Designing a tax increase roadmap directly in the law helps businesses proactively adapt, while limiting policy shocks and stabilizing the investment and business environment in the long term.

Additional tax rate for sugary drinks (Article 8)

One of the next notable points is that the new law adds soft drinks with sugar content exceeding National Standards to the list of taxable items.

• Starting from January 1, 2027, soft drinks with sugar exceeding the National Standards will be subject to an 8% special consumption tax, increasing to 10% from January 1, 2028.

The old law did not include sugary soft drinks in the list of items subject to special consumption tax. However, in practice, the consumption of these products is increasing and has negative impacts on health, especially the risk of obesity and non-communicable diseases.

Amendments to regulations on tax refunds and tax deductions (Article 9)

The 2025 Law standardizes regulations on tax refunds and deductions, such as:

• Tax refunds for imported raw materials used in the production of export goods;
• Deductions upon dissolution or bankruptcy;
• Inheritance of surplus tax when cooperatives undergo transformation;
• Tax refunds under international agreements.

These regulations are stricter and more in line with practical conditions compared to the old law, which was based on simpler cases for refunds and deductions, thereby limiting disputes and complaints about taxes. At the same time, these regulations ensure the legitimate rights of taxpayers and are consistent with the principles of modern tax administration.

Streamline and reform tax administration procedures

Although the implementation details depend on the guiding documents, the 2025 Law emphasizes reforming tax collection procedures and processes towards greater transparency and simplicity to create a favorable environment for taxpayers.

Compared to the 2008 Special Consumption Tax Law, the new regulations represent a shift from a management mindset heavily focused on collection to a modern tax management model that is taxpayer-centered, encouraging self-awareness, transparency, and compliance with the law.

The above is legal advice from Viet An Law Firm regarding legal issues surrounding the Special Consumption Tax Law 2025: New rules & excise updates in Vietnam. If you have any related questions or require in-depth legal advice, please contact Viet An Law Firm for the best support.