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Large companies should have to pay higher taxes in Switzerland. This is what the OECD minimum tax envisages. Federal Councilor Karin Keller-Sutter and SP National Councilor Jacqueline Badran fought a tough duel.
One could think that the world is upside down: the Federal Council and Parliament want to tax internationally active companies higher and introduce the OECD minimum tax of 15 percent at the beginning of 2024. Bourgeois politicians, who are usually critical of higher taxes, find themselves on the pro side.
Criticism comes from left-wing circles of all people: the SP, the Swiss trade union confederation and the NGO alliance Alliance Sud reject the OECD minimum tax, when they normally fight vehemently for higher corporate taxes.
On Friday evening in the “Arena”, the main question to be discussed was how the additional income should be distributed. It is intended that a quarter of this will go to the federal government. Three quarters of the additional tax revenue is to remain with the cantons, with those with low taxes and large companies benefiting the most. But all other cantons should also receive money through the financial equalization.
Because of the distribution key, SP Vice President Jacqueline Badran rejects the OECD minimum tax. «I have always fought to ensure that the population does not have to pay for the tax subsidies for companies. The minimum tax is therefore a gain.” Now, however, it must be ensured that the billions in additional revenue is distributed fairly.
The additional income must benefit everyone.
According to a study commissioned by the SP, a few cantons such as Zug or Basel-Stadt would benefit most from the present distribution key. “Most of the international corporations are located in these cantons. A person in the rich canton of Zug would receive much more than a person in Glarus, Thurgau or St. Gallen,” says Badran. She therefore called for a new edition of the OECD minimum tax.
“I wouldn’t hit the reset button. That didn’t come out well,” said Finance Minister Karin Keller-Sutter, referring to Federal Council colleague Ignazio Cassis and his course in the EU framework agreement.
“In order for us to have additional income at all and to be able to talk about its distribution, the minimum tax must first be introduced,” Federal Councilor Keller-Sutter stated. “If we say no, then other countries that introduce minimum taxation can siphon off the money from Switzerland.” Moreover, if the bill were accepted, everyone would benefit from the additional revenue. According to Federal Councilor Karin Keller-Sutter, the poorer cantons also received more money through fiscal equalization.
The funds could flow abroad if Switzerland does not implement the OECD minimum tax.
“The OECD minimum tax is simply unfair,” countered Daniel Lampart, chief economist at the Swiss Confederation of Trade Unions. “Despite additional tax revenue, normal earners do not receive more money. This with exploding health insurance premiums, more expensive public transport tickets and rising rents.” That is incomprehensible. There is enough time to work out a new template.
Meanwhile, GLP President Jürg Grossen warned of the pressure from neighboring countries: “If Switzerland does not go along with the OECD minimum tax now, there is a risk that the funds will flow abroad.” The template is important, especially since it creates legal certainty and planning certainty for large companies.
According to current surveys, the proposal is currently met with broad approval. Around 80 percent of respondents agree with the OECD minimum tax. On June 18, the voters will decide at the ballot box.