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Switzerland Eyes Tax Rises To Fund Infrastructure

by Ulrika Lomas, Tax-News.com, Brussels

06 December 2012


Swiss Transport Minister Doris Leuthard reportedly plans to set up a new national road infrastructure fund (NIF) to finance the construction, maintenance and extension of Switzerland's highway network, to be funded by income derived from the motorway vignette and from the petroleum tax.

Given that the current revenues from these taxes will not suffice, reports indicate that there will be a rise in the petroleum tax surcharge from CHF0.30 (USD0.32) per liter currently to CHF0.50 per liter in 2016 and to as much as CHF0.70 per liter in 2022.

The government is also said to be considering the idea of a introducing a "user pays" mechanism, whereby a new levy is imposed per kilometer traveled on the roads.

The latest reports follow hot on the heels of the Swiss Senate’s adoption of plans to finance a new railway infrastructure fund (BIF) with existing revenues currently funding railway infrastructure projects (petroleum tax and value-added tax (VAT) revenues) and with new sources of revenue.

The aim is to ensure that the financing of the new BIF fund is placed on a sustainable and solid financial basis

Additional income is to flow from a rise in rail prices in 2013 and 2017 to the tune of CHF300m, from plans to limit the commuter tax deduction for direct federal tax to CHF3,000 a year (CHF200m), and from requiring a greater contribution from the Swiss cantons (CHF200m).

The Senate also backed plans to increase VAT by 0.1% between 2018 and 2030.

TAGS: tax | vehicle tax | public sector | Switzerland | construction

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