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Families hopeful as government puts forward tax cut plans

Families stand to benefit from proposed tax cuts


The government has proposed a reform of the tax system to lighten the burden on families. The plans foresee cuts amounting to at least SFr1.3 billion a year.

After its meeting on Wednesday, the cabinet put forward five different models, and is asking all interested parties - the cantons, political parties and associations - for feedback by the end of July.

The government said the changes were necessary to reflect the evolution of family structures over the last 30 years. It said the reforms would put married couples on a equal footing with those living in a common law relationship.

The simplest model is based largely on the existing one and takes the married couple as a single economic unit, adding together the couple's earnings but taxing only half the total taxable income.

The most complicated and most expensive from an administrative point of view, is a model whereby each adult is taxed individually. To avoid disadvantages for couples, particularly those in which one partner does not work, additional deductions would have to be made.

The reforms would lead to a loss of tax income of SFr1.3 billion - SFr900 million for the federal government, and SFr400 million to be borne by the cantons.

The changes are part of wide-ranging reforms planned by the federal finance ministry, also including tax breaks for home owners and for share trading. The government hopes to present a total package of reforms to parliament in December.

swissinfo with agencies