Switzerland Reports Bumper Tax Receipts For 2019

25/02/2020

Higher tax receipts helped Switzerland to another surplus in 2019, with withholding tax and direct federal tax performing particularly well.

A surplus of CHF1.2bn (USD1.2bn) had been budgeted for 2019, but the total surplus for the year was CHF3.1bn.

Tax receipts for 2019 were up by CHF0.9bn, or 1.2 percent, on target. Withholding tax and the direct federal tax on corporate profits outperformed target by CHF1.3bn and CHF0.5bn, respectively.

However, VAT receipts remained well below target, falling CHF0.9bn below the projected figure. According to the Government, this is attributable "to the fact that nominal economic growth in 2019 lagged well behind the budget forecast (1.3 percent instead of 2.7 percent)."

The Swiss Federal Council has adopted updated budget projections for 2021-2023. Receipts of CHF76.5bn are expected in 2021, increasing to CHF78.8bn in 2022, and to CHF80.9bn in 2023.

The Council has removed from the projections proposals to reform the taxation of couples and families, as Parliament has referred the reforms back to the Council. The updated figures do not include "possible additional burdens that have not yet achieved the necessary planning status," the Council said. This includes a number of tax reforms – including an increase in deductions for health insurance, reform of residential property taxation, and abolition of stamp duty – and "the international corporate tax reforms under the aegis of the OECD, the effects of which are still unclear."

Source: Pride Partners International