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Switzerland to vote on scrapping wealthy expats tax breaks
| Published: | 24 Oct at 6 PM |
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Campaigners from Swiss trade unions and left-wing groups have collected a petition against the tax breaks containing 100,000 names, thus forcing the government to call a public vote.
Should the vote succeed, foreign celebrities, sports stars and wealthy bankers will face losing the tax breaks which make Switzerland such an appealing residential destination. Protestors are claiming that almost 6,000 multi-millionaires live in the country and benefit from very low taxes, whilst the bulk of Swiss citizens pay at normal rates.
Those named and shamed include the founder of the IKEA flat-pack furniture store, Ingvar Kamprad, singers Tina Turner, Shirley Bassey and Phil Collins and Formula One driver Michael Schumacher. In order to maintain their super-low tax payments, expats are allowed to live in the country but cannot work there without losing their privileged status.
Already, three of the country’s 26 cantons have individually decided to scrap the benefits, although the Social Democrat opposition party is determined to continue supporting the rule. As an as yet unsuccessful sop to the protestors, the Swiss government recently promised to increase taxes due from wealthy expats to seven times the annual rental value of their homes from the current rate of five times.
The opposition group Alternative Left states that the flat-rate tax undermines people's attitude to taxation and harms equal rights, and the Swiss government is also under pressure from several world countries to reveal full details of non-residents’ investments in Swiss banks. The tax breaks were first introduced in 1862 in order to encourage rich pensioners to settle in the country.
Should the vote succeed, foreign celebrities, sports stars and wealthy bankers will face losing the tax breaks which make Switzerland such an appealing residential destination. Protestors are claiming that almost 6,000 multi-millionaires live in the country and benefit from very low taxes, whilst the bulk of Swiss citizens pay at normal rates.
Those named and shamed include the founder of the IKEA flat-pack furniture store, Ingvar Kamprad, singers Tina Turner, Shirley Bassey and Phil Collins and Formula One driver Michael Schumacher. In order to maintain their super-low tax payments, expats are allowed to live in the country but cannot work there without losing their privileged status.
Already, three of the country’s 26 cantons have individually decided to scrap the benefits, although the Social Democrat opposition party is determined to continue supporting the rule. As an as yet unsuccessful sop to the protestors, the Swiss government recently promised to increase taxes due from wealthy expats to seven times the annual rental value of their homes from the current rate of five times.
The opposition group Alternative Left states that the flat-rate tax undermines people's attitude to taxation and harms equal rights, and the Swiss government is also under pressure from several world countries to reveal full details of non-residents’ investments in Swiss banks. The tax breaks were first introduced in 1862 in order to encourage rich pensioners to settle in the country.
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