Vietnam”s Ministry of Finance has unveiled a draft circular proposing a 0.1% personal income tax on every cryptocurrency transaction. This initiative represents a significant move toward formalizing the nation”s digital asset market.
The primary goal of this proposal is to align the taxation of cryptocurrencies with Vietnam”s existing framework for securities and stock trading. By doing so, the government aims to reclassify digital assets as regulated financial instruments instead of treating them as unclassified commodities.
Taxation Details for Individuals and Corporations
Under the proposed regulations, the tax treatment will vary depending on whether the participant is an individual or a corporate entity. For individual investors, a flat 0.1% tax will be imposed on the total value of each transfer or sale. This tax is calculated based on gross revenue without consideration of profits. Crucially, it will apply to all transactions carried out through licensed service providers, regardless of the investor”s residency status.
One noteworthy aspect of this tax is that it will be levied even in situations where the transaction results in a loss, distinguishing it as a turnover-based tax rather than a capital gains tax.
In contrast, corporate investors will be subject to Vietnam”s standard 20% corporate income tax on net profits derived from digital asset transfers. This profit is determined by deducting acquisition costs and related expenses from the sale price.
VAT Classification and Licensing Rules
The draft circular also specifies that cryptocurrency trading and transfers will be exempt from value-added tax (VAT). This classification reinforces the treatment of digital assets as financial instruments rather than consumer goods, which supports their integration into the formal financial system.
The tax proposal is part of a more extensive regulatory framework established by the Law on Digital Technology Industry, which officially recognized digital assets as legal property starting January 1, 2026. Following this recognition, the State Securities Commission began accepting applications for digital asset trading platform licenses on January 20, 2026.
Operational and Market Structure Requirements
Key operational requirements for licensed exchanges include a charter capital requirement of 10 trillion VND (approximately $408 million), a foreign ownership cap of 49%, and stipulations that all transactions must be conducted in Vietnamese dong (VND). These rules are part of a five-year pilot program aimed at regulating the crypto market, which commenced in late 2025.
The implications of this regulatory shift for cryptocurrency adoption in Vietnam are significant. With an estimated 17 million citizens holding digital assets, Vietnam ranks as one of the most active crypto markets globally. While the new framework offers much-needed legal clarity for exchanges, investors, and service providers, some analysts express concern that the 0.1% turnover-based tax could discourage high-frequency trading, particularly among those operating with narrow profit margins.
In summary, Vietnam”s proposal signifies a pivotal transition from informal tolerance of cryptocurrencies to a structured regulatory environment. By integrating legal recognition, exchange licensing, and a taxation system akin to that of securities, Vietnam is positioning itself to develop one of Southeast Asia”s most comprehensive frameworks for digital assets.
