About 10 years ago, the European Union, and later the OECD, had begun to put Switzerland under pressure for their privileged taxation of holdings, mixed and domiciliary companies. Switzerland’s first attempt to respond, in the form of the Corporate Tax Reform III however, was clearly rejected by Swiss voters on 12 February 2017. The Federal Council and cantons thus had to revise the potential for alternative responses. The fact that reforms are a necessity is to this day, unquestioned by advocates, as well as those who opposed the rejected bill. The Confederation recommenced its efforts accordingly and on 9 June 2017 the basic outline of the Tax Proposal 17 (TP17) was presented, which is still strongly related in content to its predecessor: the CTR III.
Measures to retain Switzerland’s attractiveness as a business location
In principle, TP17 pursues the following three objectives, similar to those of CTR III: safeguarding the tax appeal of Switzerland as a business location, promoting the international acceptance of Switzerland’s corporate tax legislation and ensuring sufficient tax revenues to finance public activities.
Its focus is furthermore, to ensure legal and investment security and a general increase in the competitiveness of the Swiss tax system, whereas special tax regimes are to be abolished. However, the loss of such special tax regimes is to be mitigated, among other things, by cantonal measures. Nonetheless, the published benchmarks have also raised some questions on the part of the business and the cantons, which is why the consultation proposal of September 2017 is impatiently awaited.
Stay on top of current developments regarding Tax Proposal 17
KPMG Switzerland is following the reform process closely, both from a political and an economic perspective. Our experts are able to provide you with regular and comprehensive insights into the current discussions. Should you wish to discuss and review how the Tax Proposal 17 measures impact the tax planning setup of your group in Switzerland, please contact us.
Peter Uebelhart, Head of Tax, Member of the Executive Committee
Stefan Kuhn, Head of Corporate and M&A Tax, Region Zurich and Ticino
Your regional contacts
Reiner Denner, Region Basel
Markus Vogel, Region Central Switzerland
Hans Jürg Steiner, Region Berne
Peter Michael, Region Eastern Switzerland
Vincent Thalmann, Region Western Switzerland
See what Vinod Kalloe, Head of International Tax Policy, KPMG Meijburg & CO, and former senior policy adviser at the European Commission (EC) has to say.