SBV has proposed an appropriate tax policy on gold trading

The State Bank of Vietnam (SBV) has recently proposed that ministries and relevant agencies consider an appropriate tax policy on gold trading, aiming to increase market transparency and serve State management objectives.

Financial context

Geopolitical tensions, tariff policies under the Trump administration, and expectations of Federal Reserve rate cuts have all been driving gold prices upward. Since the beginning of 2025, international gold prices have risen by more than 42%. Domestically, prices have repeatedly hit new record highs. Economist Dr. Đinh Thế Hiển noted that beyond the impact of global prices, domestic gold has risen even higher due to a mix of personal hoarding, speculative behavior, exchange rate fluctuations, and fears that monetary easing will inflate asset prices such as stocks and gold.

In such a volatile financial environment—expected to remain uncertain and risky, true to the essence of the VUCA era—the efforts of regulators to manage the gold market deserve recognition. These efforts are being carried out under the resource constraints of Vietnam and the continued application of Decree 24/2012. However, that decree has now completed its historical role. Accordingly, the government has issued Decree 232/2025/ND-CP, which reopens the path toward liberalizing gold production and trading (subject to licensing and conditions), and ends the monopoly over gold bullion production.

Reducing speculation

Following the issuance of Decree 232/2025, expectations have grown for a diversified supply of gold beyond the dominant SJC bullion brand. While supply could increase, much will depend on licensing and the ability to import raw materials for refining. According to SBV Deputy Governor Phạm Quang Dũng, eight banks and three gold-trading companies already meet the requirements and are finalizing applications to be licensed for bullion production. With more suppliers, the market is expected to adjust prices more efficiently.

Dr. Đinh Thế Hiển suggested that if gold can be imported and produced sufficiently, ensuring domestic prices stay within ±2 million VND per tael compared with international prices, speculative incentives would largely disappear.

Vietnamese consumers have a long-standing habit of hoarding gold, which can lead to “money under the mattress” and reduce available capital for productive investment. Addressing this requires two measures: first, ensuring sufficient supply and prices close to global benchmarks, which would weaken the rationale for gold hoarding as an inflation hedge; second, developing institutional investment channels. The SBV has disclosed plans to establish a gold exchange within Vietnam’s international financial center. Alongside the pilot digital asset market launched on September 9 and ongoing improvements to securities and derivatives markets, this initiative could attract idle household capital into the formal financial system.

Considering taxation

Against this backdrop, what role should taxation play in the evolving market?

First, many experts argue that once gold is treated as a commodity and asset class, taxation becomes necessary both to regulate supply-demand dynamics and to increase fiscal revenue.

Second, taxes need to be differentiated. Transaction taxes on gold can take multiple forms, such as value-added tax (VAT/GST), which is often applied differently to “investment gold” and “jewelry.” Economies such as the EU, UK, and Australia either exempt investment gold or apply VAT/GST based on specific standards. If Vietnam were to adopt this framework, regulators would need clear classification criteria for different types of gold.

In practice, profits from physical gold sales are generally taxable. Many countries treat these as capital gains or incidental income, applying flat or progressive rates. In the United States, physical gold is considered a collectible, with long-term capital gains taxed up to 28%, higher than the standard rate. This type of tax is likely what policymakers are considering to curb speculation. If gold is treated similarly to real estate or equities, capital gains taxation is logical—but the rate and collection mechanism must be carefully calibrated. Overly high rates could push legitimate transactions into informal channels, much as recent adjustments to securities VAT drew criticism for being poorly designed.

Individual taxation could also be considered. For example, China will apply its new VAT law from early next year, adjusting tax frameworks accordingly. China currently levies a flat 20% tax on miscellaneous income, which may apply to individual investment transactions. Importantly, China has paired taxation with a robust gold exchange system that improves compliance and transparency.

Finally, Dr. Đinh Thế Hiển emphasized that once Vietnam establishes a gold exchange, taxation and withholding at both enterprise and transaction levels will be far easier to enforce. The key challenge will be ensuring that gold trading complies with the law and does not destabilize markets or monetary policy, as occurred during the turmoil of 2011–2012.