Compliance
Vietnam’s VAT Law Reform: What Input Tax-Sensitive Businesses Need to Know
Vietnam’s newly enacted decrees adjust VAT deductions and exempt categories and could impact importers, insurers, and agricultural service providers.
By NomadicTax Research Team • 5-8 min read • August 24, 2026
## What’s Changing under Decree 144/2026/ND-CP
Vietnam’s government introduced **Nghị định số 144/2026/NĐ-CP** on **20 June 2026**, affecting the execution of the VAT Law (in Vietnam) specifically for input tax deduction conditions and VAT exempt services. ([baochinhphu.vn](https://baochinhphu.vn/sua-doi-bo-sung-mot-so-quy-dinh-ve-thue-gia-tri-gia-tang-102260506173207886.htm?utm_source=openai))
### Key Amendments Summarized
- **New VAT-exempt categories** have been added. These include various insurance services: life, health, educational, and agrarian insurance, plus reinsurance for certain marine, oil-rig and oil field structures. ([baochinhphu.vn](https://baochinhphu.vn/sua-doi-bo-sung-mot-so-quy-dinh-ve-thue-gia-tri-gia-tang-102260506173207886.htm?utm_source=openai))
- **Conditions for input VAT deduction** tightened for purchases with delayed payment (installments or deferred payment). If the **non-cash payment proof** is not available at payment due date, your business must adjust (reduce) input VAT claimed. If proof arises later, adjustments allowed in later tax periods. ([baochinhphu.vn](https://baochinhphu.vn/sua-doi-bo-sung-mot-so-quy-dinh-ve-thue-gia-tri-gia-tang-102260506173207886.htm?utm_source=openai))
## Who Is Affected Most
- **Importers** and businesses using deferred payment contracts—common in construction, machinery, raw materials.
- **Companies in insurance**—insurers and reinsurers particularly affected by the extension of VAT exemption.
- **Agricultural service contractors**, ship-owners, offshore services who deal with specialized insurance or marine contracts.
## How to Stay Compliant: Practical Steps
- Review your service offerings—if insurance-related, determine whether newly exempt categories apply.
- Ensure that contracts include **provisions for non-cash payments** or scheduled installments; get supporting bank transfer or card transaction receipts.
- For payments made over time, proactively secure non-cash payment records as early as possible. If unavailable, plan for periodic adjustments.
- In bookkeeping, segment input VAT claims by those with immediate payment vs. delayed. Adjust appropriately in tax filings.
## Actionable Planning Strategies
- If you expect significant purchases or services qualifying for VAT input, consider aligning payment terms with law (full or partial upfront, or non-cash) to preserve deduction eligibility.
- For insurers or entities offering newly exempt services, update pricing models and expense forecasting (lost input deductions may increase cost base).
- Monitor further decrees or clarifications from Ministry of Finance and GDT as implementation guidance is released.
## Example Scenario
A construction company purchases heavy equipment with a deferred payment plan over 2 years, no immediate non-cash payment proof. Under the new decree, it claims input VAT initially, but at payment deadlines failing to produce proof, must adjust (reduce) the deducible input VAT in the VAT return of that period. If proof shows up later, it can reclaim in subsequent periods.
## Conclusion
VAT reforms in Vietnam via Decree 144 tighten the rules and bring new exemptions. Input tax claims now depend heavily on **proof of non-cash payment** and timely documentation. Staying ahead through contract review, documentation control, and proper bookkeeping will be essential for businesses operating in Vietnam.