Corporate tax reform iii

Clearance Sale Ends Soon. Order The Guide Today. The third series of corporate tax reforms was meant to abolish the reduced taxation of holding, domiciliary and mixed companies.

Edition Is Now Available. This taxation is no longer in line with international standards.

Overview of key measures of CTR III 3. Reactions to the vote 5. Plan going forward 6. In view of the international developments in connection with the pressure exerted by the OEC Switzerland is being forced to redesign its corporate income tax system. The prior four corporate tax rates, with a top rate applicable to income over $million, have been reduced to a single flat rate thereby converting the corporate progressive tax system into a flat tax system. In addition, companies should continue to contribute to government revenues.

Nevertheless, this issue is not yet resolved and remains on the table! Following the development of new international standards and pressure from the European Union, Switzerland has initiated a third corporate tax reform.

Tax Proposal (TP17). The cause of this remarkable transformation is the federal corporate tax reform III (CTR III ). Currently, holding companies or corporations that have the overwhelming part of their activities abroad can benefit from a special tax status that grants tax breaks on cantonal and communal level. The new reform bill will confirm the abolition of the cantonal tax privileges as requested by the OECD and the EU. CTR III introduces an interest deduc- tion calculated based on equity exceeding a certain threshold (excess equity), known as the notional interest deduction (NID). For example, Switzerland continues with the unilateral tax exemption for income collected through a permanent establishment outside Switzerland.

The Third series of corporate tax reforms III (CTR III ) is designed to increase international acceptance of the Swiss corporate tax system and guarantee competitive tax rates. This is a major change in the Swiss tax landscape. The notional interest deduction is now thwarting this intention entirely.

It is also likely to harm developing countries. This webinar we will provide an u. The reform abolishes the reduced taxation of status companies. A corporate income tax burden of – will be available in an increasing number of Swiss Cantons as the standard rate, that is without a requirement to apply any additional tax planning measures. The need for tax reform is undisputed in Switzerland and the Federal Council will now prepare a revised bill as quickly as possible. Corporate tax reform III (CTR III ) Geneva The Geneva strategy for the RIE III becomes finally a reality!

For more informationregarding the subject, please see our other newsletters on this topic).

In answer to the corporate tax reform , the Government of the Canton of Geneva takes the decision to set a single rate of 13. The legislation is designed to boost trust in Switzerland and strengthen its position as a tax domicile. Whatever the politicians will finally enact, the Swiss tax community has done its homework. In future, competition will be based more heavily on standard tax rates instead.

Minister of finance, Mr. Ueli Maurer, has announced that a federal working group will come together in order to analyse the background of the negative voting of the Swiss people. The impact of Swiss corporate tax reform III on your company The abolishing of preferential tax regimes and the implementation of the expected corporate tax reform III will challenge many Swiss operations of multinational enterprises. Holdings should not be affected on a large scale. CTR III , the result of a long and complex political process, would have abolished current existing tax regimes, such as the rules for holding or mixed companies.

With a majority of 59. Switzerland has been under international pressure for some years because of its cantonal tax regimes for holding, domiciliary and mixed companies.