Large, internationally active companies will be taxed in Switzerland from the new year at a tax rate of at least 15 percent. The Federal Council has brought the relevant provisions into force. The people said yes to the so-called OECD minimum tax in the summer with 78.5 percent.
In the global fight against tax havens, 140 countries have agreed to tax large corporations globally at a minimum rate of 15 percent. Switzerland also wants to implement the plan of the Organization for Economic Cooperation and Development (OECD) and the G20.
The minimum tax affects corporations that achieve global annual sales of around 700 million francs. That’s around one percent of the companies operating in Switzerland. The Federal Council estimates that the new minimum tax will bring between one and 2.5 billion francs into the coffers. 75 percent of this comes from the cantons. 25 percent belongs to the federal government.
The vast majority of EU states and other important industrial nations will actually introduce the tax in 2024.
The Federal Council took its time with the implementation: “The situation was a bit confusing for a long time because many states only made their decisions very late in the year,” explains Fabian Baumer, deputy director of the Federal Tax Administration FTA, to SRF.
The picture has now cleared up: “The vast majority of EU states and other important industrial nations will actually introduce the tax in 2024,” says Baumer. With its entry into force on January 1, 2024, tax revenue will now also be prevented from flowing abroad, the Federal Department of Finance (FDF) said in a statement.
Legend: The Roche towers in Basel: The chemical company is one of the largest companies in Switzerland and is affected by the minimum tax. Keystone/Gaetan Bally
The state government is guided by various guidelines when implementing it. The Swiss regulations should be internationally accepted in order to provide companies based in Switzerland with the greatest possible legal certainty.
In addition, where the OECD/G20 regulations explicitly allow or provide for it, leeway and options should be used in the interests of Switzerland as a location. Overall, the administrative effort for companies and cantonal tax administrations should be kept as low as possible.
Novartis, Roche and Nestlé could face even more taxes
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The Federal Council will decide on the introduction of further elements of the reform by the end of 2024. The OECD/G20 tax reform includes a further pillar that stipulates that the world‘s one hundred largest companies will in future be taxed not only in the country in which they are based, but also where their services are consumed. According to the federal administration, between three and five Swiss companies are affected – including the chemical companies Novartis and Roche and the food giant Nestlé.
A few weeks ago, voices from politics and business demanded that the Federal Council should wait. In mid-November, the economic commissions of both councils recommended that the state government consider postponing the entry into force of the minimum taxation by one year.
Of course we are not happy in this sense.
The Federal Council now rejected this. «We are of course not happy in this sense. But of course we respect the Federal Council’s decision,” explains Economiesuisse President Christoph Mäder.
The business association is now demanding rapid measures to ensure that Switzerland remains attractive for international companies. “The value creation of international companies should remain in Switzerland as far as possible,” says Mäder. “That means: We have to strengthen the framework conditions for these companies.”
The cantons are required
“Everything hasn’t been disclosed yet, but we still have a certain amount of time despite it coming into force. Because the tax revenue will only flow from 2026,” explains the President of the Cantonal Conference of Finance Directors, Ernst Stocker. The affected cantons have already made some decisions. “We are prepared.”
There is still some adjustment time for cantons and companies – despite the introduction decided at short notice.