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Switzerland intends to implement 15% minimum tax as of 2024
Tax

Switzerland intends to implement 15% minimum tax as of 2024

13.01.2022
New rules are aimed at multinationals, with no change to rate charged to domestically focused companies and small and medium enterprises
Switzerland will introduce the 15% rate on multinationals from 2024
Switzerland will introduce the 15% rate on multinationals from 2024
Photo credit: Shutterstock

The Swiss government intends to implement a minimum tax rate of 15% as of January 2024.

The new rules are aimed at multinationals, while domestically focused companies and small and medium enterprises won’t see any change, the Bern-based government said. Taxes will be collected by the Swiss cantons, who also will retain any additional tax receipts.

The OECD deal, agreed by around 140 nations last year, could effectively allow other countries to impose additional tax on undertaxed profits of multinationals in Switzerland. The Swiss government said by imposing additional tax on undertaxed firms itself, it will ensure large companies are spared foreign proceedings.

“If that 15% has to be collected, then we want it to be collected here in Switzerland,” Finance Minister Ueli Maurer told reporters in the capital on Thursday. 

During the negotiations for the global agreement, some countries pushed back against the deal, saying higher taxes would make their economies less attractive for foreign investment. 

The Swiss government said Thursday that it will find “leeway to counteract a possible loss of attractivity as a business location.”

Given the complexity of the matter, which eventually need a change of the Swiss constitution, the government will implement the new measures via a so-called ordinance and only then start an “ordinary legislative procedure without time pressure” to put the new tax regime on a standard legal footing. 

Switzerland will carry out a national vote on the constitutional change in June 2023, Maurer said. 

Even with this legal manoeuvre, Switzerland’s implementation would be a year later than the OECD’s intended 2023 start date.

©2022 Bloomberg L.P.


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