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Switzerland Divided On Major Tax Initiatives

by Ulrika Lomas, Tax-News.com, Brussels

23 October 2013


A Swiss survey has highlighted the fact that voters are currently very much divided over plans to increase the Confederation's motorway vignette by 150 percent, over the 1:12 initiative aimed at curbing excessive remuneration, and over the family tax initiative. These proposals are due to be put to the vote in a national referendum on November 24.

According to the survey conducted by Swiss market research institute gfs.bern, 53 percent of those questioned were in favor of plans to increase the price of the annual motorway vignette from CHF40 to CHF100, while 41 percent expressed their opposition to the measure, and 6 percent said that they were undecided. The bill, which has already been waved through by parliament, also provides for the introduction of a CHF40 two-month vignette for foreigners.

Although divided, voters do nevertheless appear to have a clear opinion on the issue. While advocates of the proposal argue that the motorway charge must rise to finance vital transport infrastructure projects, opponents maintain that the Confederation's road network should not be expanded and reject the idea of any tax rises.

Furthermore, the institute found that 64 percent of those surveyed agreed with the so-called "family initiative" put forward by the Swiss People's Party (SVP), while 25 percent expressed their opposition to the proposal, and 11 percent stated that they were unsure. The SVP's family initiative provides that traditional stay-at-home parents should benefit from the same income tax deduction as their working counterparts with third party childcare, thereby placing all families on an equal tax footing.

In the run up to the referendum, these figures may well spur opponents of the plans to make their position clearer. One argument that has not as yet been raised is that the proposal will merely serve to benefit the Confederation's wealthiest parents, who can already afford to stay at home on a single income.

Finally, the survey revealed that the Young Socialists' 1:12 Initiative for Fair Play has divided opinion equally. Indeed, 44 percent of those interviewed backed plans to curb executive remuneration, while 44 percent were against, and 12 percent were still wavering. The initiative stipulates that a company's highest paid employee must not be paid in excess of 12 times the salary of its lowest paid worker.

In view of the split vote, and the fact that a great deal is at stake, both sides will inevitably endeavor to up the ante to persuade voters in the remaining weeks ahead. While proponents of the initiative insist that the measure is necessary to restore social justice and to eliminate intolerable wage disparities, opponents warn of the very serious implications of the plans. They stress that it would simply force companies to relocate their activities abroad, and deter new companies from setting up in Switzerland, resulting in significant job losses and dramatic lost revenues.

TAGS: tax | tax rates | Switzerland | tax breaks | individual income tax

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