Vietnam Passes First-Ever Law on Digital Technology Industry
June 19, 2025
In a historic move, Vietnam has become the first country in the world to adopt a dedicated law focusing specifically on the digital technology industry. The landmark legislation, known as the Law on Digital Technology Industry, was passed during the ninth session of the 15th National Assembly on June 14, 2025, with an overwhelming majority—441 out of 445 deputies voting in favor. The law is set to come into effect on January 1, 2026, marking a significant milestone in the nation’s digital transformation efforts.
Objectives and Vision
The newly established law aims to reshape Vietnam’s digital economy and provide legal clarity to key sectors including artificial intelligence (AI), digital assets, and data services. It underscores Vietnam’s aspirations for digital transformation while fostering innovation, enhancing international competitiveness, and facilitating global integration. The legislation aligns with national strategies outlined in Resolution No. 57-NQ/TW and No. 68-NQ/TW, which focus on advancing science and technology as well as promoting private sector development.
Incentives for Digital Enterprises
One of the cornerstone features of the Digital Technology Law is its structured incentives aimed at a diverse range of stakeholders. The Vietnamese government is committed to boosting production and improving the global standing of the nation’s tech products through the "Make in Vietnam" initiative.
A major goal outlined in the law is to facilitate the establishment of 150,000 digital technology companies by 2035. To achieve this, domestic startups could benefit from subsidies of up to 50% for technology acquisition and prototype development. Furthermore, small and medium-sized enterprises (SMEs) will receive additional support, including financial aid for training, preferential access to public procurement, and assistance with infrastructure investments.
Foreign-invested enterprises (FIEs) are also encouraged to engage in partnerships with local firms, particularly in technology transfer initiatives. In exchange, these companies will enjoy favorable conditions such as long-term corporate income tax reductions and other investment incentives designed to enhance integration into global supply chains and promote the localization of technology.
A Comprehensive Fiscal Framework
The Digital Technology Law delivers a holistic fiscal framework to promote digital production and innovation. The Vietnamese government pledges to prioritize funding for high-tech and innovation-driven projects while offering tax breaks and import duty exemptions on essential equipment and research and development (R&D) activities.
Under this law, enterprises in the digital technology sector will be granted tax incentives equivalent to those offered in specialized disadvantaged areas, thus making Vietnam a more appealing destination for both local and international investment. Additional capital support from state investment funds and grants is designed to facilitate the expansion of tech operations across the country.
Fiscal Incentives Overview
| Type of Incentive | Beneficiaries | Details |
|---|---|---|
| Corporate Tax Reductions | FIEs meeting tech-transfer goals | Companies collaborating with local partners may receive multi-year corporate income tax reductions. |
| Technology Acquisition Subsidies | Startups and SMEs | Up to 50% of the cost to acquire advanced technology and develop prototypes is reimbursable. |
| Import Duty Exemptions | Tech manufacturers and R&D projects | High-tech equipment used in production or R&D may qualify for import duty exemptions. |
| Infrastructure Investment Support | SMEs and strategic investors | Government will assist with infrastructure investment costs and prioritize procurement for qualified SMEs. |
| Grant Funding | Innovation projects and digital transformation | State-backed funds will provide financial support to approved projects focused on technological innovation. |
Emphasis on Workforce Development
Crucially, the new law recognizes the importance of developing a skilled workforce for the digital age. It includes provisions aimed at fostering the growth of qualified digital professionals, ensuring that Vietnam is not only a hub for digital enterprise but also well-equipped with the necessary human resources to thrive in the global digital economy.
The passing of the Digital Technology Law marks a significant step forward in Vietnam’s ongoing efforts to establish a robust digital environment and further integrate itself into the global digital landscape. With this framework in place, Vietnam aims not only to bolster its domestic tech industry but also to attract international investors and partners, paving the way for transformative growth in the years to come.