Citing OECD pressure to reform its tax system, Switzerland is considering abolishing existing tax arrangements that no longer meet international tax standards, primarily the cantonal tax statuses for holding, domiciliary, and mixed companies.
New rules would be added, however, to enhance the country’s “appeal as a tax location,” including a royalty box. An interest-adjusted profit tax would also be introduced.
In a Sept. 22 press release, the Swiss government said the cantons would also have the opportunity to introduce targeted capital tax reductions. In addition, the new tax proposals “include the abolition of the issue tax on equity capital, adjustments to participation deductions and the offsetting of losses, as well as comprehensive rules for the disclosure of hidden reserves. Finally, the taxation of participation holders [would be] adjusted by introducing a balanced mix of tax-reducing and tax-increasing measures,” the government said.
A consultation on the proposals will run until January 31, 2015.
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