Switzerland has achieved a major milestone in the adoption of the global minimum tax and the Base Erosion and Profit Shifting (BEPS) 2.0 Project. This important development occurred when a constitutional amendment was successfully passed through a public referendum on 18 June 2023. The approved amendment allows the Swiss government to implement global anti-base erosion (GloBE) rules, including the domestic top-up tax, through an implementation ordinance.
Only large, internationally active corporate groups with annual turnover of at least 750 million Euro are subject to the new minimum taxation. In Switzerland, this concerns a few hundred domestic corporate groups and a few thousand foreign corporate groups. As a result, approximately 99% of companies in Switzerland are not directly affected by the reform and will continue to be taxed as before.
Taxation may turn out to be lower than 15% in all cantons. However, it primarily occurs in cantons with a low tax burden, where many large and profitable companies are based.
If the minimum tax rate is not reached, the shortfall will be levied by means of a supplementary tax. Otherwise, other states could collect the shortfall instead of Switzerland. The supplementary tax is a federal tax. As with the current direct federal tax, however, it will be implemented by the cantons.
Switzerland is anticipated to implement the domestic top-up tax and the income inclusion rule (IIR) starting from the financial years commencing on or after 1 January 2024.
