Proposed reforms to its tax and fiscal policy should help Switzerland maintain its tax appeal and increase its compatibility with international standards, said Finance Minister Eveline Widmer-Schlumpf on Thursday.This content was published on December 19, 2013 - 19:58
Reforming the Swiss corporate tax system was the objective of a series of meetings chaired by Widmer-Schlumpf and attended by representatives of the finance ministry and the Conference of Cantonal Finance Directors.
The committee members, who were appointed in September 2012, examined a number of proposals for reforms which would hopefully strengthen Switzerland’s ability to innovate and make the country more attractive as a business location.
“We want to position our country optimally,” said Widmer-Schlumpf.
According to the final report released on Thursday, the committee members favoured preferential taxation of royalties for cantonal taxes, and recommended looking more closely at the abolishment of the issue tax on capital and a restricted interest-adjusted profit tax model at both the federal and cantonal levels.
To promote innovation, the committee favoured lower tax rates for profits stemming from intellectual property, such as patents, brands and licences.
The committee proposed maintaining the current system of national fiscal equalisation, but acknowledged that the system would have to be adjusted if corporate tax reforms were put in place.
Corporate taxation is an important aspect of attracting businesses to a country. The Organisation for Economic Co-operation and Development (OECD) and the European Union are working to ensure fair tax competition among countries, efforts that are supported by Switzerland.
At present, however, some of the provisions of Switzerland’s corporate tax system are not compatible with international standards. Switzerland “is willing to hold talks with the EU on contentious issues regarding business taxation,” said a government statement.
Under pressure from the EU, the committee recommended introducing a tax regime which treats domestic and foreign profits equally. At present, companies in Switzerland benefit from lower income tax rates on foreign income.
The final report presented by Widmer-Schlumpf on Thursday will now go to the cantons for comment. The cabinet will decide how to proceed based on the results of the consultation.
This article was automatically imported from our old content management system. If you see any display errors, please let us know: email@example.com