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Located centrally in Europe, Switzerland is a small, wealthy country with several unique aspects. One of these is the famous political system of “direct democracy” – which enables the electorate to express their opinion on decisions taken by Swiss Parliament and to propose amendments to the Federal Constitution. This system is underpinned by two instruments: initiatives and referendums.


Switzerland is also a fully-fledged member of the OECD, along with 36 other countries with market-based economies. The main vision of the OECD is for its members to “collaborate to create policy standards that promote sustainable economic growth and world trade”.

  • In the last 50 years, GDP growth has been mostly positive in Switzerland and averaged 1.74 percent from 1981 until 2022, reaching a record of 9.30 % in Q2/21 and a record low of -7.20 percent in the Q2/20. Favourable business conditions including low tax rates, have in part been responsible for Switzerland’s enviable track record of success.
  • The OECD is proposing that all members introduce a minimum 15% corporate tax rate, which will apply to any company with annual revenues of Euro 750 million or more. This has essentially been forced on Switzerland by the OECD as part of its plan to reduce global tax competition. But imposing rules without electoral consent is not that simple in Switzerland, specifically because of the principals and system of “Direct Democracy”.


Currently, the average rate of company tax paid in Switzerland stands at around 13.5%. However, there are 26 cantons or states in Switzerland, with 2,136 municipalities and these all determine their own rates. The Swiss Confederation gives the cantons full power in matters of taxation, except for taxes under the control of the federal government. Each canton handles tax differently. Some examples: The highest rate is 17.4% in canton Jura and the lowest is 9.4% in canton Nidwalden. In other cantons the rates are: Zug (9.6%), Basel-City (9.9%), Vaud (11.8%), Geneva (12.4%) and Zurich (15.7%).

Regarding the OECD ruling, Swiss voters will decide whether to accept or reject the plan on 18 June 2023 when a referendum takes place.




What if the OECD proposal is accepted by the Swiss electorate?

It is estimated that Switzerland currently earnings from corporate tax is about CHF14 bn.  Should the OECD  proposed tax rate of 15% be ratified by the Swiss electorate, it is estimated that between CHF1-2.5 bn additional revenues would be collected. These incremental funds will be apportioned between the cantons where the companies are based as well as with the Federal Government.

The two cantons that would be most impacted in the German speaking part of Switzerland are Zug and Basel-City. these are home to 400 and 250 affected companies respectively. Zug is reportedly going to invest all additional tax funds received into the local economy, with both Zug and Basel City planning to support R&D and environmental initiatives of the large companies affected.


What will happen if the Swiss electorate reject the OECD minimum tax proposal?

Should the Swiss electorate reject the OECD tax proposal, the general consensus is that this would be damaging for Switzerland.  A no vote by the Swiss electorate, would probably mean that the Swiss parliament would have to draft a new bill with some adjustments to ensure the OECD proposal is accepted.



The Swiss system of Direct Democracy lies at the heart of the Swiss political system and has over the years, ensured that the electorate in Switzerland has a voice and is able to respond to parliamentary decisions if they don’t agree on legislation. This is unique in the world. But this status quo is being constantly challenged as Switzerland has formed unions with international and global organisations. The OECD tax case is just the latest example of this.

18 June 2023,  is deadline day for the OECD corporate tax vote to take place and we will only know then if Switzerland accepts or rejects the proposal.  In the meantime, we can but reflect on the outcome and possibly learn from readings from the past. such as the quote on tax from Winston Churchill, who famously said  “We contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle?”


Accurity is SECO licensed with a 20+ year enviable reputation as a trustworthy, reliable and transparent partner for companies of all sizes including SMEs, contractors and recruitment agents. We also work with cross border workers living in France and working in Switzerland  – as well as those living in Switzerland and working remotely for foreign companies. Our core services include Employer of Record or EOR for contractors and international and domestic clients wishing to engage contractors. Our pricing system is fair and transparent. We are based in Switzerland and have excellent local knowledge and connections. Contact our team to see how we can help you.