Business License Tax or “Thuế Môn Bài”: Which Term Is Correct?

Which is the most accurate term: business license tax (“lệ phí môn bài”) or “thuế môn bài”?

Update note: From 01/01/2026, the collection and payment of the business license tax has ceased under Clause 7, Article 10 of Resolution 198/2025/QH15; Decree 139/2016/ND-CP and Decree 22/2020/ND-CP have been repealed by Decree 362/2025/ND-CP.

Before the collection and payment of the business license tax ceased on 01/01/2026 (Clause 7, Article 10 of Resolution 198/2025/QH15), under Article 8 of Decree 126/2020/ND-CP, the business license tax was a type of tax or other state budget revenue declared annually.

Previously, the business license tax was called “thuế môn bài” under the 1983 Ordinance on Industrial and Commercial Tax. At that time, “thuế môn bài” was understood as a business tax that organizations and individuals regularly doing business, or trading on a per-trip basis, all had to pay.

However, from 01/07/2017, the term “thuế môn bài” was changed to “lệ phí môn bài” (business license tax/fee) when the Law on Fees and Charges 2015 took effect.

Must an enterprise file a business license tax declaration immediately upon a change in charter capital?

Update note: From 01/01/2026, the collection and payment of the business license tax has ceased under Clause 7, Article 10 of Resolution 198/2025/QH15; Decree 139/2016/ND-CP and Decree 22/2020/ND-CP have been repealed by Decree 362/2025/ND-CP. Therefore, enterprises are no longer required to file business license tax declarations when charter capital changes; the provisions quoted below are for historical reference only.

Pursuant to Article 10 of Decree 126/2020/ND-CP (the former regulation on the business license tax — no longer applicable since collection and payment ceased on 01/01/2026), the time limit for filing business license tax declarations is as follows:

Time limit for filing tax declarations for revenues from land, the business license tax, registration fees, mining right grant fees and other revenues under the law on management and use of public assets

Taxpayers shall comply with the time limit for filing tax declarations as prescribed in Article 44 of the Law on Tax Administration. For the time limit for filing declarations of revenues from land, the business license tax, registration fees, mining right grant fees and other revenues under the law on management and use of public assets under Clause 5, Article 44 of the Law on Tax Administration, the following applies:

1. Business license tax

a) Business license tax payers (except household businesses and business individuals) newly established (including small and medium enterprises converted from household businesses) or newly establishing dependent units, business locations or commencing production or business activities shall file the business license tax declaration no later than January 30 of the year following the year of establishment or commencement of production or business activities. Where there is a change in capital during the year, the business license tax payer shall file the business license tax declaration no later than January 30 of the year following the year in which the change information arose.

b) Household businesses and business individuals are not required to file business license tax declarations. The tax authority shall, based on the tax declaration dossier and the tax administration database, determine revenue as the basis for calculating the amount of business license tax payable and notify the business license tax payer in accordance with Article 13 of this Decree.

Thus, before the collection and payment of the business license tax ceased on 01/01/2026, where a small or medium enterprise had a change in capital during that period, the enterprise filed the business license tax declaration within the year. Currently, enterprises are no longer required to file business license tax declarations.

The latest time limit for filing (before the collection and payment of the business license tax ceased on 01/01/2026) was January 30 of the year following the year in which the change information arose.

How was the business license tax rate for enterprises determined when there was a change in charter capital?

Update note: From 01/01/2026, the collection and payment of the business license tax has ceased under Clause 7, Article 10 of Resolution 198/2025/QH15; Decree 139/2016/ND-CP and Decree 22/2020/ND-CP have been repealed by Decree 362/2025/ND-CP. The rates quoted below are for historical reference only.

Pursuant to Article 4 of Decree 139/2016/ND-CP (repealed by Decree 362/2025/ND-CP), the business license tax rates are as follows:

Business license tax rates

1. The business license tax rates for organizations producing and trading in goods and services are as follows:

a) Organizations with charter capital or investment capital above VND 10 billion: VND 3,000,000/year;

b) Organizations with charter capital or investment capital of VND 10 billion or below: VND 2,000,000/year;

c) Branches, representative offices, business locations, public service units and other economic organizations: VND 1,000,000/year.

The business license tax rates for organizations under points a and b of this Clause are based on the charter capital stated in the business registration certificate; where there is no charter capital, they are based on the investment capital stated in the investment registration certificate.

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4. Where an organization under points a and b, Clause 1 of this Article changes its charter capital or investment capital, the basis for determining the business license tax rate shall be the charter capital or investment capital of the year immediately preceding the year of business license tax calculation. Where the charter capital or investment capital stated in the business registration certificate or investment registration certificate is in foreign currency, it shall be converted into Vietnamese dong to determine the business license tax rate at the buying exchange rate of the commercial bank or credit institution where the business license tax payer opens an account, at the time the business license tax payer pays into the state budget.

Accordingly, the business license tax rates for small and medium enterprises were as follows:

– Enterprises with charter capital or investment capital above VND 10 billion: VND 3,000,000/year;

– Enterprises with charter capital or investment capital of VND 10 billion or below: VND 2,000,000/year.

This business license tax rate (before collection and payment ceased on 01/01/2026) was based on the charter capital stated in the business registration certificate. Where there was no charter capital, it was based on the investment capital stated in the investment registration certificate. Before the collection and payment of the business license tax ceased on 01/01/2026, where an enterprise changed its charter capital, the basis for determining the business license tax rate was the charter capital or investment capital of the year immediately preceding the year of business license tax calculation.