Vietnam enforces e-invoicing for domestic businesses to improve tax clarity and transparency

Rewritten Article:

Vietnam's Household Businesses Embrace Digital Transformation in Tax Sector

The city of Hà Nộ́i, Vĩt Nam, is speeding up its digital transformation in the tax sector by widening the use of electronic invoices (e-invoices) to household businesses - a move intending to reduce revenue loss and boost transparency.

As of June 1, an extensive range of household businesses has been mandated to issue e-invoices directly from cash registers. This system allows transactions to be recorded in real-time and automatically sent to tax authorities.

This represents a significant shift in the tax authority's approach to managing household businesses, as outlined in Decree 70/2025.

During the first quarter of this year, more than 3.6 million business households throughout the country contributed approximately VND8.7 trillion (US$334.5 million) to the state budget, marking a more than 30% increase compared to the same period in 2024.

Traditionally, household businesses, including small traders, market vendors, and service providers, have operated under minimal supervision, often issuing paper invoices or no invoices at all.

The majority of these businesses endorse the new tax management regulations. They believe these changes will help mitigate certain risks, such as miscalculating taxes due to confusion between personal and business finances, selling goods without issuing invoices, and incurring financial losses from poor control of input materials or outgoing orders.

Many households have proactively started using sales management software like KiotViet, Sapo, and Salesbook, which cater to various customer segments and industries. Nonetheless, some still rely on integrated services like electronic invoices and comprehensive solutions provided by large companies such as Viettel, VNPT, and Misa.

However, a few households remain skeptical about changing their business practices.

Nguyễn Huy Hùng, owner of a catering business on Lý Thường Kiệt Street in Hà Nộ́i, invested around VND10 million in new equipment. He also hired a young employee to manage the counter, enabling easier data input and order processing.

Hùng conveyed to the Saigon Times that employing staff was an unwelcomed but necessary step, as many older employees are not tech-savvy. He also expressed concerns about potential technical issues when the new system launches, which could result in errors on incoming invoices or delays in issuing invoices. This could lead to penalties from tax authorities if suppliers fail to provide timely assistance. As a result, he hopes the tax authority will establish binding agreements with equipment suppliers to ensure they support business households.

Nguyễn Hữu Tài, operator of a mobile coffee business in Hà Nộ́i, outlined the obstacles posed by his non-fixed location. He and his employees often face limitations with data transmission and equipment placement, making it challenging to install similar machines as those used in stationary shops.

A staff member at the Petrolimex Hà Tĩnh gas station transmits sales data to the tax authority's system. - VNA/VNS Photo

Therefore, he is exploring service options that can be integrated into phones or compact, user-friendly devices.

From an expert's perspective, Nguyễn Văn Được, general director of Trọng Tín Accounting and Tax Consulting Company, highlighted that transitioning from paper invoices to electronic invoices may initially pose difficulties for household businesses.

Not every household or individual business possesses the necessary technology or equipment, like cash registers, and this inadequate infrastructure complicates the transition, as they must invest in new equipment and learn how to utilize it effectively.

Additionally, many business households have enjoyed lump-sum tax arrangements in the past, and now, they must declare all revenue and expenses, causing reluctance to comply fully.

Được mentioned that Decree 70/2025 obligates household businesses to make this transition. If the tax authority provides support in terms of policy and technology, and taxpayers have the necessary resources yet still delay compliance, penalties may be imposed. Hence, it's crucial to gradually ease these constraints to support business households while ensuring accountability.

Currently managing over 271,000 business households, a nearly 30% increase from 2024, the Tax Department of Region I is actively collaborating with all districts and localities to ensure that no unregistered households are overlooked.

The authority is also adding to its management list all household businesses requiring invoices generated from cash registers.

"From now until June 1, we will launch public awareness campaigns to address the challenges faced by household businesses during this transition," Nguyễn Tiến Minh, deputy head of the Tax Department of Region I under the Ministry of Finance, informed vtv.vn.

"We will partner with electronic invoice solution providers to offer tailored support specific to household business needs, linking electronic invoices from cash registers with electronic tax declarations."

The Minister of Finance has also contacted leaders of various provinces and centrally governed cities, urging them to support the tax sector in promoting nationwide implementation of electronic invoices from cash registers effectively.

However, the mandate comes with clear enforcement measures. Household businesses that fail to register for or issue e-invoices as required may face administrative penalties, including fines and potential suspension of operations. - BIZHUB/VNS

Challenges Faced by Household Businesses:- Technical Barriers: Many lack cash registers, digital devices, or stable internet access, making e-invoice issuance more difficult[1][5].- Financial Constraints: Upgrading systems or integrating e-invoices with accounting software increases short-term expenses, particularly for smaller businesses[5].- Reluctance to Change: Households accustomed to lump-sum tax regimes now face detailed revenue/expense declarations, causing resistance[1].- Operational Disruptions: Transitioning processes (e.g., canceling paper invoices, adapting to new deadlines) risks errors and non-compliance[3][5].

A value-added tax invoice is issued to customers after each sale at Petrolimex Hà Tĩnh. - VNA/VNS Photo

Support Measures from the Tax Authority:- Policy and Technical Assistance: Tax authorities are working with districts to provide guidance on e-invoice usage and ensure no unregistered households are neglected[1].- System Enhancements: Tax offices are upgrading IT infrastructure to handle increased e-invoice volumes and decrease technical failures[5].- Deadline Flexibility: While penalties may apply for non-compliance, authorities are emphasizing gradual adaptation to ease the adjustment process[1][3].- Legal Clarifications: Decree 70 refines procedures for invoice adjustments, replacements, and VAT declarations, aiming to streamline compliance[2][3].

The tax sector in Hà Nộ́i, Vĩt Nam, is undergoing digital transformation, mandating household businesses to issue electronic invoices (e-invoices) directly from cash registers.
This new regulation aims to reduce revenue loss and boost transparency within the tax sector.
The tax authority's approach to managing household businesses, as outlined in Decree 70/2025, is experiencing a significant shift.
Many household businesses endorse the new tax management regulations, believing they will help mitigate certain risks, such as miscalculating taxes or incurring financial losses.
Some household businesses have proactively started using sales management software like KiotViet, Sapo, and Salesbook to comply with the new system.
Nguyễn Huy Hùng, a catering business owner, invested in new equipment and hired a staff member to manage the counter, enabling easier data input and order processing due to digital transformation.
Some households remain skeptical about changing their business practices, expressing concerns about potential technical issues and penalties from tax authorities.
Nguyễn Hữu Tài, operator of a mobile coffee business, faces obstacles due to his non-fixed location, making it challenging to install similar machines as those used in stationary shops.
The Tax Department of Region I is actively collaborating with all districts and localities to ensure that no unregistered households are overlooked during the transition to electronic invoices.

Alteration in tax administration for home-based enterprises, as outlined in Decree 70/2025.

Revised tax administration for home-based businesses, as outlined in Decree 70/2025, marks a significant shift in approach by the tax authorities.

Vietnam enforces e-invoicing for domestic businesses to improve tax clarity and transparency