Vietnam’s household businesses, a cornerstone of the country’s informal economy, are operating under growing financial strain and shrinking margins, with complex tax and accounting regulations pushing many to the brink, according to a new national survey by the Vietnam Chamber of Commerce and Industry (VCCI).
The 2026 VCCI survey, conducted across the country, found that household businesses remain a vital pillar of family income and social welfare. Yet the sector is increasingly fragile, with falling revenues, shrinking customer bases and a prevailing preference to hold steady or scale back rather than expand.
At the heart of the problem, VCCI said, is a deepening mismatch between increasingly sophisticated regulatory demands and the actual capacity of micro and small operators to comply with them.
The data paints a stark picture. Only 49.8 percent of surveyed businesses said they had a basic understanding of new tax and accounting rules, while 33.9 percent said they had merely heard of them. Most reported significant difficulties with core compliance tasks such as issuing electronic invoices, recording expenses, and filing tax returns.
The compliance burden grows heavier as business size increases. Among operators with annual revenues below 500 million Vietnamese dong (around $19,400), 61.5 percent said the time required for compliance was a major or very major burden. That figure rose to 77.1 percent among those earning between 500 million and 3 billion dong ($19,400 to $116,000), and reached 87.3 percent for those above 3 billion dong.
More than 70 percent of respondents expressed concern over complex administrative procedures, nearly 70 percent feared regulatory penalties, and more than 60 percent cited high compliance costs and difficulty keeping up with regulatory changes.
VCCI urged authorities to prioritize simplifying tax, accounting and e-invoicing rules in ways that reflect the real capacity of household operators, particularly those running micro-scale operations, those with lower levels of education, and older business owners.
The federation also called for the development of low-cost, easy-to-use compliance tools, including simplified accounting software, plain-language guidance on tax filings, and direct local support mechanisms, rather than assuming most household businesses can absorb new regulations without assistance.
Support policies, VCCI added, should clearly identify priority groups. Households that depend entirely on their business as their primary livelihood should be shielded from abrupt regulatory shocks. Micro and vulnerable operators need basic compliance and management support. Larger household businesses with corporate clients or clearer capital needs should be the primary targets of programs encouraging formal registration as enterprises.
On the question of formalization, VCCI said the policy focus must shift toward reducing the real costs of transition. This means offering conditional financial incentives in the early stages, simplifying post-registration administrative procedures, providing accounting and tax support during the first years of operation, and designing a gradual compliance pathway rather than imposing full obligations immediately after registration.
“If the perceived costs and risks of transitioning are not addressed, the share of household businesses willing to formalize will remain persistently low,” the report warned.
