In general, cantons with low corporate tax also perform well compared to the highest tax rates. The canton of Zug has the lowest income tax rate at around 22.4%, followed by Appenzell-Innerrhoden (24.1%), Obwalden (24.3%) and other cantons in Central Switzerland. High incomes are the most heavily taxed in Geneva (44.8%). In the cantons of Basel-Landschaft (42.2%), Vaud (41.5%) and Bern (41.0%), high income tax rates are also relatively high. A natural person residing in Switzerland is generally taxed on worldwide income. However, no tax is due on the income of foreign companies and foreign permanent establishments as well as on foreign real estate. Despite the exemption, the respective income is taken into account when determining the (progressive) tax rates. Property transfer tax is levied in Switzerland by the cantons and/or municipalities and is generally payable by the purchaser of a property. Property transfer tax is always payable in the canton or commune concerned when a property changes hands. The tax is levied on the purchase price or on the market value. The exemplary rates of land transfer tax in relation to the value of the property are as follows (please note that for restructurings, transactions between parents, etc. Democracy also applies to taxes: the Swiss vote on the taxes they have to pay.
Often, they can also have a say in setting tax rates and the tax coefficient. In 2011, federal income tax ranged from a range of 1% (for individual taxpayers) and 0.77% (for married taxpayers) to a maximum rate of 11.5%. People earning less than 13,600 francs and couples earning less than 27,000 Swiss francs were exempt. At the cantonal level, tax rates vary considerably, Obwalden adjusted a flat-rate tax of 1.8% on all personal income after a cantonal referendum in 2007. In most cantons, the rate is proportional to a maximum rate of 6.5% in Bern, while in Zurich it was 13% and in Geneva from 17.58 to 0.76% (depending on individual taxes or total tax). [19] [20] A capital gain on real estate sold by an individual is not subject to federal tax unless the property is part of the business assets. Real estate capital gains are taxable at cantonal and communal level. Tax rates are progressive and there are surcharges for short periods of detention and discounts for long periods of detention. Thus, high profits made over a short holding period could be taxed at a rate of more than 50%.
No tax is levied when the profit is reinvested, but only if the property is the taxpayer`s principal residence. With the tax calculator of the Federal Tax Administration, you can easily calculate the cantonal and communal tax you should expect and compare taxes, statutory tax rates, effective tax rates and cooperatives from different cantons and communes. Several cantonal tax administrations also offer similar calculators. The federal corporate tax rate is flat at 8.5%, but additional cantonal and communal rates can vary considerably. The maximum corporate tax rate, including all federal, cantonal and communal taxes, is between 11.9% and 21.6%. However, a series of allowances and deductions means that you usually pay much less. The most significant changes were recorded in the cantons of Glarus, Schaffhausen, Jura and Fribourg, which each reduced their average income tax rate by around -0.3 percentage points in 2021. Bern and Thurgau also lowered their rates by around -0.2 percentage points each. Although Obwalden was the only canton to increase its income tax rate by +0.2 percentage points, it remains one of the three most attractive cantons with a rate of 24.3%.
The Confederation may levy customs duties and other charges on the cross-border movement of goods imported within the Swiss customs area. Rates are based almost exclusively on weight (e.B. CHF X per 100 kg gross). Revenue from customs duties is paid into the Federal Treasury and amounted to around CHF 1.13 billion in 2016. [37] The Confederation (a flat rate of 8.5%) and the cantons (at different rates) levy a proportional or progressive tax on corporate profits. Tax is based on net income as presented in the income statement and adjusted for tax purposes. [25] For example, expenses that have no business reason, such as excessive depreciation, provisions or provisions, and disguised dividends are taxed as profits. [26] Wealth tax varies from canton to canton, with maximum rates ranging from around 0.5% to 0.8%. Income tax rates are progressive at the federal level and in most cantons. In 2020, federal income tax ranged from a range of 0.77% (for individual taxpayers) and 1% (for married taxpayers) to a maximum rate of 11.5%. No federal tax is levied on individuals with taxable income of less than CHF 14,500 and on couples with taxable income of less than CHF 28,300.
At the cantonal level, tax rates vary considerably, with a maximum rate in Zurich of around 41.3%, compared to 23.1% in Zug, 32.6% in Lucerne, 41.5% in Lausanne and 48.0% in Geneva (all rates include federal income tax). On the website of the Federal Tax Administration you will find various explanations about the system, information on the cantonal effective tax rates and lists of the tax coefficients applied in the different municipalities as well as examples of calculations. Internationally, taxes in Switzerland are rather moderate, with tax rates varying considerably from one canton and municipality to another. In 2016, around CHF 183 billion in taxes were levied in Switzerland, of which CHF 65.5 billion was levied by the Confederation, CHF 46 billion by the cantons, CHF 28 billion by the municipalities and CHF 45 billion in the form of social security contributions. [51] The overall tax rate was 27.8% of GDP in 2016. [51] The effective rate of individual tax varies considerably depending on the canton and commune of residence. In 2006, for example, duly taxed companies paid between 13 and 25% of income tax, and the maximum personal tax rates in large cities ranged from 12.3% in the canton of Zug to 32.3% in the canton of Jura. [52] Wealth tax is levied in all cantons and communes, which includes all taxpayers` property and rights that have a present value. These assets and rights are generally valued at market value. Taxable assets include, in particular, immovable property, fixed assets, cars, reimbursable life and pension insurance and commercial assets. Ordinary household assets are exempt from tax. The wealth tax base is net wealth, that is, gross wealth, which is reduced by the sum of the taxpayer`s documented debts.
In addition, social deductions can be made from net assets. These vary from canton to canton, as do tax rates, which are generally progressive. The exemplary burden of wealth tax for married persons without children in the respective cantons/communes for a taxable asset of CHF 5 million is as follows (2020): KPMG expects a further tax reduction, albeit moderate, in the coming years, as some cantons have not yet implemented all the tax reductions provided for in the trafficked corporate tax reform. They are gradually spreading the cuts over a period of up to five years, so corporate tax rates are expected to fall to around 14.3% by 2025. The largest cuts are expected in Basel-Landschaft (-4.5%), Ticino (-3.3%) and the canton of Jura (-2.0%). The highest income tax rates in Europe are again in Sweden (57.3%) and Denmark (56.5%), to which Austria (55.0%) is now added. A global comparison outside Europe shows that the highest rates apply to Japan, China, Australia and South Africa, each with a maximum tax rate of 45%. Several offshore homes and some isolated countries in the Middle East continue to waive income tax altogether.
Federal Tax Administration – Tax terms (explanations of legal tax rates, legal tax rates, calculation period/tax year, etc. Not all cantons levy a property tax, but it is often levied in tourist resorts and areas with a large number of second homes. Property tax rates are generally between 0.1% and 0.15% of the tax value of the property. Switzerland is a Federal Republic in which the sovereignty of the constituent states (the cantons) is limited by the enumerated powers conferred on the federal state (the Confederation) by the Federal Constitution. Therefore, the initial power to collect taxes belongs to the Swiss cantons through their constitutions. [1] Within the framework of the powers conferred on them by cantonal law, municipalities may also levy taxes. The extent of this power varies from canton to canton. [2] While the formal framework for the main cantonal direct taxes was harmonised by the Federal Tax Harmonisation Act of 1990, the cantons (and, where appropriate, the communes) remain free to set their tax rates or levy new taxes, with the exception of tax purposes that have already been taxed under federal law. [3] VAT is levied only at the federal level, essentially on all goods and services. .