Switzerland: A tax haven for consumers - Economiesuisse


Economiesuisse

08.08.2022, Zurich - The low burden of consumption and excise taxes in Switzerland is unique in Europe. In comparable countries, the tax burden on consumption is much higher. This is another proof for the fact that the salami tactics propagated by left-wing circles, consumption up but capital down tax, has no hands and feet in reality. Those who are currently benefiting from attractive company taxes consumers.


Entgegen den Behauptungen linker Kreise gibt es keine Anzeichen, dass Konsumentinnen und Konsumenten für die insgesamt massvolle Steuerbelastung der Firmen in der Schweiz aufkommen müssen. Gegenüber Nachbarn in Europa ist die Schweiz steuerlich eine regelrechte Oase für die Konsumierenden. Daten der OECD zeigen: Steuern auf dem Konsum tragen in der Schweiz deutlich weniger zu den Staatseinnahmen bei als anderswo in Europa, etwa in Deutschland, Frankreich, den Niederlanden und Österreich.

UNIQUE LOW VAT

The most important consumption tax is VAT. On the sale of goods and A standard rate of currently 7.7 percent is charged for services in Switzerland. This tax rate is significantly lower than in all EU member states. According to the VAT Directive, the not fall below the standard rate of 15 percent charged by EU countries. So lies the next lower one Standard rate compared to Switzerland at 17 percent for Luxembourg. The highest VAT will be with 27 percent levied in Hungary and the median of VAT levied in the EU is 21 Percent.

SLIGHTLY FALLING TAX REVENUE FROM CONSUMPTION AND CONSUMPTION

Since 1995, the standard VAT rate has also tended to rise slightly in Switzerland. So In 1999, the people decided to increase the rate from 6.5 to 7.5 percent to finance AHV and IV. 2001 the standard rate was increased by a further 0.1 percent for railway infrastructure. From 2011 took place finally, a temporary increase to 8 percent to restructure the IV. Since 2018, the Standard rate of 7.7 percent, which should rise to 8.1 with the AHV 21 template. History shows Value added tax increases in Switzerland usually flow directly into the financing of social benefits for the benefit of the population.

In addition to value added tax, there are other consumption taxes, for example on tobacco, alcohol, electricity, combustibles and fuels. A comparison of tax revenues from consumption as a whole also reveals a gap between Switzerland and the much higher burden in comparable European countries. Over time, a slight downward trend in consumption-based tax revenues can also be observed in Switzerland. Consumers in Switzerland are therefore being asked to pay much less than in comparable European countries. While 9.8 percent of national income (GDP) was taken from consumers in Germany and 12.3 percent in France as of 2020, the figure in Switzerland was just 5.2 percent. Furthermore, the financial contribution of consumers in Switzerland actually decreased slightly from 1995 to 2020 (by -0.2 percentage points).

INCREASING CONTRIBUTIONS FROM CORPORATE TAX MAKE IT POSSIBLE

Despite the stable to falling burden on consumption, the tax rate in Switzerland rose above the same period from about 24.9 percent to 27.6 percent of GDP. So how can an increasing tax rate with a deep burden on consumers and a relief on middle incomes (as already shown ) be agreed? The explanation lies in the significant additional income from the corporate taxes. Their contributions have risen from 1.6 to 3.1 percent of GDP since 1995. Over time they also record the most striking in comparison with the comparable countries mentioned Rise. Only companies in the Netherlands make the same tax contribution as those in Switzerland. The contributions of the companies in the surrounding countries are with a difference of at least -0.8 percent. In Germany, companies only contribute 1.6 percent. Attractive corporate taxation therefore pays off in terms of tax revenue.

ALL BENEFIT FROM A COMPETITIVE TAX POLICY

The fact that the Swiss consume unparalleled in Europe Profiting from deep sentences is therefore in particular the consequence of a successful one tax location. The assertion that in Switzerland only wages, pensions and consumption are taxed should be disproved quickly with a look at the tax data. Actually allow it the lucrative corporate taxes, a heavier burden on consumers - as they are in comparable countries can be observed – to be avoided. A competitive tax policy for companies is therefore central to maintaining Switzerland as a consumer tax haven. with the reform the withholding tax, which will be voted on in September, the successful policy can be continued.


Contact:
Dr. Christian Frey
Deputy Head of Finance & Taxes
+41 44 421 35 82
christian.frey@economiesuisse.ch

Joël Brühlmann
Research Associate Finance & Taxes
+41 44 421 35 62
joel.bruehlmann@economiesuisse.ch

Note: This article was translated from German to English by an online translator.

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