Canton Geneva has made the biggest jump in the annual Credit Suisse ranking of attractive business locations, moving up ten spots to sit just behind Zurich.This content was published on October 13, 2020 - 15:17
According to the Credit Suisse location quality survey published on Tuesday, canton Zug, home to big multinationals like Glencore, took back its top spot from canton Basel City. This is thanks in large part to corporate tax cuts that went into effect in canton Zug at the beginning of 2020.
Canton Geneva, home to the United Nations European headquarters, rose ten spots since last year and now sits in fourth place behind Zurich. The second-largest jump up the rankings came for canton Fribourg, which moved up five spots to 18th place.
Both cantons also reduced corporate tax rates, making it more fiscally attractive to companies looking to set up shop in Switzerland, according to Credit Suisse.
“In 2020, the taxation of companies is probably the biggest criterion affecting locational attractiveness rankings,” writes Credit Suisse in a press release. However, it notes that many cantons are offering attractive tax rates that the relative advantage of low corporate tax rates between cantons has declined.
Last year, the Swiss voted in favour of corporate tax reform that included scrapping preferential treatment for multinational firms. Since this vote, many cantons have lowered the overall corporate tax rate to remain attractive to corporates.
Accessibility with various means of transport helps urban centers like Zurich, which took the third spot. According to the Swiss bank, government services and good infrastructure generally offset the disadvantage of tax burden in some urban centers.
Urban areas also benefit from a higher educated workforce. More than 40% of potential employees in cities and surrounding areas have a higher education degree.
The Credit Suisse location quality indicator survey has been published since 1997. It assesses seven factors including tax burden on legal entities and private individuals, availability of specialized labour and highly qualified personnel, population accessibility, employee accessibility, and access to airports.