The Ministry of Finance of Vietnam Proposes a Pilot Program for Taxing Digital Assets

The Ministry of Finance of Vietnam is finalizing a draft resolution to present to the Government regarding the pilot issuance and trading of cryptocurrency assets. The main focus of this initiative is the tax obligations related to activities involving encryption. This move marks a significant step in integrating digital finance into the legal framework, ensuring both market development and tax collection. Tax Obligations for Electronic Currency Transactions According to the Ministry of Fintech, all transactions of cryptocurrency assets in Vietnam must comply with current tax regulations. On March 11, 2025, based on Directive No. 22/CĐ-TTg dated March 9, 2025, of the Prime Minister and Notification No. 81/TB-VPCP dated March 6, 2025, of the Government Office, the Ministry presented Proposal No. 64/TTr-BTC. This draft resolution not only proposes a pilot mechanism for the issuance and trading of cryptocurrency assets but also emphasizes the need to build appropriate tax policies to regulate this rapidly developing market. The department acknowledges that cryptocurrency assets have undergone significant global expansion, with high trading volumes and complex characteristics. Millions of participants worldwide, including Vietnam, are engaged in cryptocurrency trading. However, this rapid growth poses substantial challenges for tax management, as cryptocurrency transactions often occur across borders, are easily concealed, and pose risks of tax evasion. Countries like Japan and the European Union have implemented specific tax policies for cryptocurrency assets, highlighting the need for Vietnam to establish its own regulatory framework. Pilot Program to Develop an Electronic Currency Tax Framework In this context, the pilot program aims not only to provide a legal environment for fintech innovation but also to test effective tax collection methods. The Ministry of Finance announced that the pilot implementation will be carried out on a small scale under the close supervision of regulatory authorities. This will allow the authorities to assess the feasibility of applying value-added tax (VAT), corporate income tax (CIT), and personal income tax (PIT) to cryptocurrency transactions. "The cryptocurrency asset market is expanding rapidly, but most transactions have not yet been declared for tax purposes. The pilot program will allow the tax authorities to explore ways to determine taxable income from cryptocurrency assets, ensuring transparency, preventing revenue loss, and protecting investors," a representative of the Ministry of Finance explained. The current tax laws of Vietnam provide a basic framework for all business activities, including VAT on goods and services and income tax on individuals and businesses. However, the main challenge for cryptocurrencies lies in classifying them under specialized laws. It remains unclear whether they should be regarded as goods, securities, or a unique type of asset. This ambiguity makes accurate classification and tax enforcement difficult. To address this issue, the Ministry proposed that, in the pilot phase, cryptocurrency exchanges must cooperate with tax authorities to accurately record and report transaction data, serving as the basis for tax declaration and payment. Technology Tax Monitoring A notable feature of the draft resolution is the planned cooperation between the Ministry of Fintech and the General Department of Taxation to implement a digital tracking system for cryptocurrency transactions. This system will help identify individuals and organizations earning income from cryptocurrency assets while detecting potential tax evasion and money laundering activities. This initiative aims to ensure that once cryptocurrency assets are officially recognized, tax policies can be applied effectively and consistently. The Ministry also emphasized that taxing cryptocurrency assets is not only aimed at increasing government revenue but also at promoting a transparent financial market. "If cryptocurrency assets are legally recognized as a tradable asset, market participants must fulfill their corresponding tax obligations. During the pilot phase, we will experiment with different tax rates to determine the optimal approach—an approach that promotes market growth without overburdening participants," the Ministry stated. Temporary Tax Guidelines and Policy Development in the Future To facilitate tax collection, the Ministry of Fintech plans to propose temporary guidelines on cryptocurrency taxation, including methods for handling transaction losses. These guidelines will provide a basis for local tax authorities to implement tax collection during the pilot phase while gathering feedback from businesses and individuals to refine long-term policies. This draft resolution reflects Vietnam's commitment to establishing a structured approach to cryptocurrency asset management, in which taxation plays a central role in ensuring fairness and sustainability. The results of this pilot phase will be crucial in shaping Vietnam's future tax policies regarding the digital finance sector.