Keine Bilder? Webversion Rejection of Swiss Corporate Tax Reform III by the Swiss PeopleOn February 12, 2017, the Swiss People rejected the so called Corporate Tax Reform III (CTR III) with a clear majority of 59.1%. Only four cantons (Zug, Vaud, Nidwalden and Ticino) out of 26 approved the proposal. No doubt this is not the result multi-national companies and many other stakeholders in Switzerland were hoping for. Nevertheless, there is no reason to see only dark, negative scenarios with regards to the future of Switzerland as a business hub. The fact is that Switzerland has committed to the OECD and EU that it will abolish any ring fencing schemes like Holding or Mixed Company privileges. This is important to avoid Switzerland appearing on any type of black lists. The abolishment of these and other tax privileges are not controversial for the public. It is further not controversial that an increase of the tax burden for the affected companies must be avoided in the course of abolishing the existing tax privileges. One of the reasons, or maybe the main reason, for the rejection of the proposed law, however, was that many voters did not understand how the reduction of the ordinary tax rates and the other tools to reduce the tax burden (e.g. R&D super deduction or Notional Interest Deduction) would be financed, or, in other words: who would pay the bill. Therefore, the following will most probably happen:
In the meantime, the situation remains as follows:
We recommend our clients to carefully evaluate their own tax position not only from a purely Swiss perspective but also in light of BEPS. This might mean renouncing existing tax rulings, strengthening the substance or aligning their business models. In light of the recent developments around CTR III it might also mean deferring the taxation of profits, evaluating a tax neutral step-up or other possibilities, but it definitely does not mean having to be concerned about the future competitiveness of Swiss tax law. For further information, please contact: VISCHER AG The publisher cannot be held liable for the correctness, completeness and topicality of any contents or presentations in this News Alert. Copyright © 2016 VISCHER AG; Basel/Zürich. All rights reserved.
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