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For legal entities, the municipality of Lucerne emerges as Switzerland’s lowest-tax cantonal capital, with a rate of 12.32%. By contrast, the municipality of Geneva had a corporate tax rate of 24.16% in 2018 – almost twice as high.
There are in some cases major differences in corporate tax rates between municipalities, based on where a company has its registered office. For example, the lowest rate in the canton of Solothurn is 18.67% in the municipality of Däniken, while the highest is 22.68% in the municipality of Matzendorf. However, various other cantons, such as Neuchâtel, St Gallen and Basel-Stadt, apply uniform rates.
Switzerland’s low-tax cantons rank alongside the lowest-tax EU countries. The high-tax cantons in Switzerland, which levy rates almost twice as high, are at the lower end of the mid-range on an international comparison.
Switzerland’s low-tax cantons rank alongside the lowest-tax OECD/G20 countries. The high-tax cantons in Switzerland, which levy rates almost twice as high, are only in the mid-range on an international comparison.
The US tax reforms are already having an impact in 2019, after tax rates were reduced to 21–28% in 2018. This made the United States much more attractive relative to other OECD and G20 countries.
The income tax burden within Switzerland varies considerably not just from canton to canton, but also from municipality to municipality.
100'000 CHF net income
This overview shows the tax rates of the cantonal capitals. The figures refer to a net income of CHF 100,000. In this scenario, the canton and city of Zug have the lowest tax rate, at 10.50%. The city of Neuchâtel brings up the rear, with a tax rate more than twice as high (24.10%).
The chart below shows the rates of the various cantonal capitals only. However, it should be borne in mind that there are major differences within some cantons. The highest tax rate in this scenario is 25.70%, in municipalities including Enges in the canton of Neuchâtel. However, the tax rate in the city of Neuchâtel – the capital of that canton – is slightly lower, at 24.10%.
250'000 CHF net income
This overview shows the tax rates of the cantonal capitals. The figures refer to a net income of CHF 250,000. The city of Zug once again tops the rankings in this scenario, with an attractive tax rate of 18.50%. Meanwhile, the city of Neuchâtel no longer occupies last position; this is now held by the city of Lausanne, at 35.10%.
Glarus is the only canton that has a uniform tax rate. With a difference of only 1.2 percentage points, the canton of Zug has a very small range between the lowest and highest municipal tax rates. The largest difference between municipalities– 10.1 percentage points – is found in the canton of Grisons.
Marginal tax rate
This overview shows the tax rates of the cantonal capitals. The figures refer to the maximum marginal tax rate. The city of Zug yet again tops the list, at 22.40%. The city of Geneva is in last place, with a rate almost twice as high as Zug’s (45.00%).
Depending on the level of taxable income, it makes sense to compare not only the various cantons and their cantonal capitals, but also individual municipalities in different cantons. Although the city of Zug offers the lowest marginal tax rate burden of the cantonal capitals, a tax burden of 22.70%, which is almost as low, can be achieved in the canton of Schwyz, e.g. in the municipality of Wollerau.
For further information, kindly download our brochure "International Tax Comparison".
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