The importance of developing regulatory frameworks to manage virtual assets, virtual currencies, crypto assets, crypto currencies was at the centre of discussion of the Government Standing Committee’s meeting on March 3.
Following the discussion, the Government Office and the Prime Minister issued Notice 81 on March 6, and Directive 22 on March 9, respectively, stressing the need to pilot a programme on the issuance and trading of digital assets.
The draft decree outlining the programme’s content was submitted by the Ministry of Finance to the Government on March 11.
Digital assets are being issued and traded in large volumes, with high transaction value and complexity, around the world and in Vietnam, according to the ministry.
The widespread popularity of these assets presents opportunities, challenges, and risks, to the stability of the financial system and the development of economies, prompting regulatory agencies in many countries to develop legal frameworks to regulate and manage this market.
The pilot programme, announced on March 20 will be implemented under State management and supervision. It will create a flexible legal environment in Vietnam that adapts to, and leave room for, innovation, which fosters business development and the growth of the digital economy, the ministry said.
A digital asset market – piloted with a limited scale under the control and supervision of regulatory authorities – will respond to meet market demands, while giving regulators time to develop appropriate policies and mechanisms in line with real-world conditions.
This preparation will help to minimise illegal activities such as money laundering and terrorist financing, protect investors, and lay the groundwork for the development of a transparent, safe and sustainable financial market, according to the ministry.
The finance ministry proposed that a coordination mechanism will be developed between the ministry, the Ministry of Public Security and the State Bank of Vietnam to promote market activities, while minimising financial security risks and ensuring market stability.
The draft decree added that while current tax laws have had provisions for taxing goods and services bought, sold, and consumed within Vietnam, regulations related to digital assets lack provisions on the identification and classification of digital assets and related commercial activities.
As a result, at the moment, there is no legal basis for applying corresponding tax policies for the trading of digital assets.
If the specialised laws on digital assets clarify the nature of digital assets and allow them to be traded as an asset class, then tax obligations will be fulfilled in accordance with tax laws, according to the Ministry of Finance.
