Zuger Partners AG
Switzerland, An attractive tax regime
A business-friendly tax environment
Switzerland has a modern tax system designed to respond to the needs of the economy. In accordance with the country's federal structure, taxes are imposed at three levels in Switzerland: the federal level and the cantonal and municipal levels. The combined tax rate is much lower compared to other industrialized countries. Companies that establish operations in the Geneva and Berne metropolitan area and create jobs may benefit from full or partial tax relief under certain conditions.
Moderate corporate tax rates
At the federal level, the corporate tax rate is only 8.5% of net profits. In addition, taxes on profits must be paid to the canton and the municipality, and the rates vary depending on the location of the company. Tax competition between the cantons has contributed to making Switzerland a country with low tax rates and supportive tax authorities. The authorities of the tax administration are true partners of the companies and the current trend is towards a decrease in corporate tax rates. Individual tax rates also vary from canton to canton.
An internationally competitive tax regime
In international comparisons, Switzerland has some of the most favorable tax conditions. The cantons of the Geneva Berne metropolitan area have put in place some particularly interesting framework conditions that attract numerous companies from all over the world every year. These companies benefit not only from low tax rates, but also from Switzerland's double taxation treaties with all its major trading partners, such as the US, China, Germany, France and Italy.
Corporate tax reforms
In order to ensure the international acceptance of Swiss corporate tax law with lasting effect, several schemes that are no longer internationally recognized were abolished at the end of 2019. However, to guarantee the continued attractiveness of the economic location, the abolition of the schemes was accompanied by a reduction in corporate tax rates, as well as a series of possible deductions, with an emphasis on R&D and innovation.