Switzerland’s canton of Ticino approved tax reforms aimed at reducing tax burden on high-income earners and making Ticino more attractive for top managers. The tax reforms include reducing individual income tax rates, amending inheritance and gift taxes, and decreasing taxation on capital withdrawals from pension schemes.
The key provisions of the newly approved tax reforms are:
- Gradual reducing the maximum income tax rate from 15.1% to 12% over the period of six years, until 2030, starting from 2024;
- A 50% reduction in the gift and inheritance tax on business assets transfers in Ticino (sole proprietorships, partnerships, or a majority of shares in a corporation) subject to a five year lock-up period;
- Increasing the lump-sum deduction for professional expenses to CHF 3,000 from CHF 2,500;
- Reducing income tax rates for individuals by 1.667%;
- Lowering the maximum inheritance and gift tax rates from 41% to 35% (non-relatives/third parties), and from 41% to 15.5% (for life partners, children of life partners, and foster children).
These tax reforms will be retroactively effective from 1 January, 2024.
