A 15% tax on large companies is in sight
Council of States Royalties Committee endorses resumption of OECD and G20 reform.
The project intends to impose 15% on all large companies whose turnover exceeds 750 million euros.
KEYSTONE/Christian Beutler
Large companies should also be taxed at 15% in Switzerland. The royalties commission of the Council of States approves without opposition the resumption of the reform of the OECD and the G20.
Bern has an interest in resuming the reform, underlines the commission in a press release published on Friday. The project intends to impose 15% on all large companies whose turnover exceeds 750 million euros. If one state does not play the game, additional taxes could be imposed in another country.
Switzerland, known for having particularly favorable corporate tax rates, has no choice but to fall in line to avoid losing tax revenue abroad. About 200 Swiss companies and 2,000 subsidiaries of foreign groups would be affected. The approximately 600,000 SMEs and other companies operating solely in Switzerland will not be affected.
Uplift
No reliable estimate exists on the revenue potentially generated by the additional tax. High-tax cantons will, however, become more attractive compared to low-tax cantons, the commission notes.
In his view, it is justified to leave most of these additional revenues to the cantons concerned so that they can take measures to maintain the attractiveness of their economic location. By 9 votes to 2 and 2 abstentions, the committee therefore supports the planned distribution of additional revenue, ie 25% for the Confederation and 75% for the cantons.
A minority proposes to distribute them according to the distribution key of the direct federal tax. The Confederation would thus obtain 78.8% of the windfall. The reform would only reinforce the tax disparities between the cantons, judges the minority. More cantons are expected to take advantage of the additional revenue with his proposal.
The committee still wants, by 9 votes to 4, to give the Federal Council more leeway. It must also be able to provide for the deductibility of the additional tax as a charge for income taxes.
Popular vote in June 2023
A constitutional amendment is required to implement differentiated corporate taxation. The Council of States should take up the file at the September session, and the National at the following session. The objective is to submit it to the people and the cantons on June 18, 2023.
A transitional ordinance, already put out for consultation, must then guarantee the entry into force of the minimum tax on January 1, 2024. The final entry into force will however be decided according to the progress of the implementation in the other states. The corresponding law will be adopted later.
Given the special nature of the procedure, the commission unanimously asks to be consulted on the consultation order, as well as on the other orders and changes to orders that will be made later.
ATS
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