Swiss Voters Reject Corporate Tax Reform Plan
The political establishment in Switzerland has been left stunned after voters rejected a proposed corporate tax reform plan designed to align the country’s tax system with international standards.
The tax reforms, which had strong support from the business community, would have eliminated special low-tax privileges that incentivized multinational companies to establish themselves in Switzerland.
The future of Switzerland’s tax system is now uncertain, and the outcome of the vote could create challenges for companies that had relied on the reforms, as well as discourage potential relocation to the country.
“This lack of clarity about future tax measures is not conducive to making sound investment decisions,” stated Peter Uebelhart, the head of tax at KPMG in Switzerland, in a video statement.
Switzerland has faced increasing pressure from G20 and OECD nations to reform its tax system and risks being “blacklisted” if changes are not made by 2019.
Many voters rejected the tax reform package due to concerns that it could lead to a decrease in government revenue, potentially resulting in higher taxes for the middle class, according to Stefan Kuhn, head of corporate tax at KPMG in Switzerland. These rules have been criticized as granting unfair corporate subsidies, according to international tax authorities.
Martin Naville, head of the Swiss-American Chamber of Commerce, suggested that voters may not have fully understood the complexities of the reform measures. The reforms were rejected by 59% of voters.
“I consider this a very unfortunate outcome for Switzerland,” Naville commented. “Undoubtedly, the uncertainty and credibility of the Swiss system have been severely damaged.”
Related: The Vulnerability of Europe’s Electoral Processes to Hacking
Swiss authorities have committed to quickly developing a modified tax reform proposal, and Naville expressed hope that new rules will be formulated within the next few months.
“All stakeholders must now take responsibility in creating a competitive and acceptable tax system that restores the famed political stability that gave Switzerland its advantageous position,” Naville said in a statement.
Naville also suggested that potential tax reforms in the US and UK could entice Swiss-based companies to relocate, further pressuring Switzerland’s tax base.
CNNMoney (London) First published February 13, 2017: 10:10 AM ET
Denial of responsibility! VigourTimes is an automatic aggregator of Global media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, and all materials to their authors. For any complaint, please reach us at – [email protected]. We will take necessary action within 24 hours.
