Vietnam: Over 95,000 Business Tax Codes Canceled, Economic Implications Explored

In Vietnam, it has been revealed that the tax codes (tax identification numbers) of 94,991 businesses and organizations were canceled between January and August of this year. Of these, only 23,017 cases completed the procedures within the current year, with the remaining approximately 72,000 cases being applications submitted from 2025 and earlier. This situation suggests a potential contraction or restructuring of business activities, or the streamlining of dormant organizations within the Vietnamese economy. The Vietnamese government is accelerating a 'tax code cleanup' campaign aimed at resolving bottlenecks in the business environment. This campaign seeks to build a healthier economic foundation by enhancing administrative efficiency and eliminating non-operational companies and organizations. Local tax authorities, such as those in Thai Nguyen province, are also actively implementing this 'tax code cleanup' campaign, providing support measures like issuing handbooks on tax code cleanup to help businesses navigate tax procedures smoothly. Under Vietnam's one-party system, economic growth is a primary objective, with policies focused on attracting foreign investment and fostering domestic enterprises. Potential factors behind the tax code cancellations include the economic slowdown post-COVID-19, or the contraction of some businesses due to global supply chain realignments. Furthermore, given Vietnam's strong economic ties with China, the trends in the Chinese economy are also relevant. The government's 'tax code cleanup' is also seen as an effort to enhance economic transparency and strengthen the tax revenue base.