Vietnam’s electric vehicle policy now offers some of the region’s strongest tax incentives for investors across the supply chain. This article provides general information only and is not legal advice for any specific case. Regulations may change – please consult a professional before acting.
To accelerate the shift to green transport, the Vietnamese Government has rolled out a series of electric vehicle (EV) policies – tax and fee incentives, public-procurement preferences and consumer support – that both track global technology trends and give concrete effect to Vietnam’s emission-reduction commitments.
1. Tax Incentives for EVs
Law No. 03/2022/QH15 (effective 1 March 2022) sharply reduced the special consumption tax (SCT) on battery electric cars, creating a decisive competitive edge. The SCT roadmap starts low and steps up after the initial incentive window:
- Cars up to 9 seats: 3% (1 Mar 2022 – 28 Feb 2027) → 11% (from 1 Mar 2027);
- 10–16 seats: 2% → 7%;
- 16–24 seats: 1% → 4%;
- Passenger-cum-cargo vehicles: 2% → 7%.
In addition, Decree No. 51/2025/ND-CP (amending Decree 10/2022) extends the 100% exemption from first-time registration fees for electric cars until 28 February 2027 – replacing the original plan to cut the exemption to 50% from March 2025. The extension signals a stronger, more flexible commitment to the EV market.
These measures align with the green energy transition roadmap under Decision No. 876/QD-TTg and Vietnam’s COP26/COP28 climate commitments.
2. Market Potential and the Investment Case
The policy push is delivering results. Vietnam’s auto market rebounded to roughly 340,000–390,000 new vehicles in 2024, with battery-electric vehicles posting triple-digit growth – helped by tax incentives and affordable model launches. Market reports project EV-sector growth above 20% per year through 2025–2030, opening opportunities across the supply chain: batteries, components and final assembly.
For international investors, the current framework offers three structural advantages:
- Stability and transparency: the incentive roadmap is legislated through 2027, making cash-flow and payback modelling straightforward;
- Multi-layer incentives: beyond SCT and registration-fee relief, EV manufacturing projects can access corporate income tax incentives, FTA tariff reductions on components and industrial-zone land incentives;
- Alignment with national strategy: EV projects contribute directly to the Net Zero 2050 target, easing access to green finance and international support programmes.
3. What Investors Should Prepare For
Executing an EV manufacturing project in Vietnam demands more than capital and technology: it requires command of investment, environmental, tax, customs and IP regulations, plus cross-border transaction rules. From choosing the investment form (100% FDI, joint venture or OEM cooperation) and obtaining the Investment Registration Certificate, to negotiating partner contracts and meeting technical standards – each step benefits from experienced local counsel.
Planning an EV or green manufacturing project in Vietnam?
Our Projects & Infrastructure and Tax teams structure incentives, licensing and supply-chain contracts end to end. Contact us for a consultation.
Electric vehicle policy incentives: FAQ
Which incentives matter most for manufacturers?
The registration fee exemption for battery electric cars, preferential special consumption tax rates, and CIT incentives for supporting-industry and high-tech projects form the core of the electric vehicle policy package. Manufacturers locating in industrial zones can stack location-based incentives on top, subject to the global minimum tax rules for very large groups.
Do charging infrastructure investors get support?
Charging networks can access land and electricity pricing support under the emerging electric vehicle policy framework, and several provinces now fast-track planning approval for stations along designated corridors. Official announcements are published by the Ministry of Finance and provincial authorities.
How long will the incentives last?
Registration-fee relief and consumption-tax preferences run on statutory timetables that have already been extended once; investors should model both the current window and a conservative post-window case. Our team tracks each electric vehicle policy instrument and its sunset date as part of project feasibility work.
Where do foreign investors usually start?
With a sector-and-site scan: confirm the activity fits WTO commitments, choose between manufacturing, assembly, components or services, and map which electric vehicle policy incentives attach to each option before committing capital.
Reading the electric vehicle policy as one system
The electric vehicle policy is best read as one system rather than a list of discounts: demand-side relief pulls buyers in, manufacturing incentives anchor supply, and infrastructure support closes the loop. Investors who align their project with all three strands of the electric vehicle policy – for example, assembly plus charging plus fleet leasing – consistently capture more value than single-strand entrants, and negotiate better terms with provinces competing for exactly that kind of integrated commitment.
This article is provided for general information only and does not constitute legal advice for any specific case. Regulations may change – please consult a qualified professional before acting. Should further analysis be required, please contact one of our lawyers below.
