Social insurance (SI) contributions
Compulsory SI contributions are applicable to Vietnamese individuals. Effective from 1 January 2018, SI contributions are also applicable to foreign individuals working in Vietnam under a work permit, practicing certificate, or licence and having labour contracts with indefinite terms or term labour contracts with Vietnamese employers of one full year and above.
The level of compulsory SI contribution for a Vietnamese employee is 25.5% of total salary and some allowance, of which 17.5% is the employers’ obligation and the remaining 8% is the employees’ obligation. While SI contribution for foreign employees is 3.5% of total salary and some allowance, it is the employers’ obligation to cover the sickness and maternity leave fund and occupational diseases and accident fund. The retirement and death fund is not covered; however, contribution will start from January 2022. The employees’ obligation is not required until January 2022.
The salary subject to SI contribution is the salary stated in the labour contract, but is capped at 20 times the minimum basic salary.
Health insurance (HI) contributions
Compulsory HI contributions are applicable to both Vietnamese individuals and expatriates, except those transferred from their mother companies abroad to subsidiary firms in Vietnam (i.e. assignees). HI contribution rates are 4.5% of total salary and some allowance, with 3% contributed by the employer and 1.5% by the employee.
Salary/wage subject to HI contribution is capped at 20 times the minimum basic salary for HI contributions.
Unemployment insurance (UI) contributions
Compulsory UI contributions are applicable to Vietnamese individuals only. Expatriates are exempt. The employer and employee contributions are 1% on total salary and some allowance. The employee contribution is capped at 20 times the minimum regional salary for UI contributions.
Value-added tax (VAT)
VAT is applied to goods and services used for production, trading, and consumption in Vietnam (including goods and services purchased from abroad), with certain exemptions. The 10% 'standard' rate applies to activities not specified as exempt or subject to the reduced 0% or 5% rate. See Other taxes in the Corporate tax summary for more information.
Inheritance, estate, and gift taxes
See the Income determination section for a description of the taxation of inheritances and gifts.
Luxury and excise taxes
Special sales tax (SST) is a form of excise tax that applies to selected goods and services, such as alcohol, imported automobiles having less than 24 seats, motorcycles, airplanes, boats, petroleum, air-conditioners up to 90,000 British thermal units (BTU), cigarettes, playing cards, discotheques, massages, karaoke, casinos, gambling, golf clubs, and entertainment with betting and lotteries. See Other taxes in the Corporate tax summary for SST rates.