The Swiss electorate rejected the Company Tax Reform III on 12. February 2017.
This reform would have been a solution for repealing special tax status for companies. This proposal did not convince voters, even though cantons had tailored solutions at their disposal that corresponded to their industrial networks and location promotion.
The rejection of this by Swiss voters at the polls is not the end of the debate. Many questions remain unanswered.
- What will cantons do that host many companies with special tax status?
- Will the Federal Council be able to quickly find a national solution?
- How will companies with special tax status react to the volatile situation caused by the voting result?
Tax competition between the cantons will most likely intensify because of the rejection of USR III. The development of tax legislation abroad will lead to increasing pressure on Switzerland’s competitive position.
Canton Bern has announced on March 30, 2017 that it will implement its tax strategy that was presented on 17 September 2015, independent of the results of the USR III. This proposal will lead to a marked reduction in profit tax rates. Municipalities that receive large amounts of tax revenues from legal persons, for example Biel community, will be faced with difficult decisions. During the November session of Berne cantonal parliament the new tax law 2019 will be discussed.
Federal Council has mandated Federal Finance Department to present a new draft for an amended Company Tax Reform by End of June 2017. First hearings with involved parties have already taken place.
Omnitax would be pleased to assist you in the assessment of measures to be taken as a result of this new situation.
