You can try on latest 1.4 images. Here is a simple example:
vyos@vyos:~$ show config comm | grep dns
set service dns forwarding allow-from '192.168.99.0/24'
set service dns forwarding authoritative-domain example.com records a host66 address '192.0.2.66'
set service dns forwarding listen-address '192.168.99.1'
vyos@vyos:~$ show config comm | grep eth3
set interfaces ethernet eth3 address '192.168.99.1/24'
Then, on host located on LAN, in this case attached to eth3:
PC1> show ip
NAME : PC1[1]
IP/MASK : 192.168.99.5/24
GATEWAY : 192.168.99.1
DNS : 192.168.99.1
MAC : 00:50:79:66:68:01
LPORT : 10030
RHOST:PORT : 127.0.0.1:10031
MTU : 1500
PC1> ping host66.example.com
host66.example.com resolved to 192.0.2.66
84 bytes from 192.0.2.66 icmp_seq=1 ttl=64 time=0.535 ms
84 bytes from 192.0.2.66 icmp_seq=2 ttl=64 time=0.719 ms