Imputed rental value
The imputed rental value (actually the «rental value taxation of owner-occupied properties») is a term from Swiss tax law. Rent or lease expenses are estimated here that would arise if the property were rented or leased. These avoided expenses increase the efficiency of the owner and are subject to income tax .
Origin and legal basis
The basis of this tax, which was mentioned in the Federal Council resolution on the levying of a defense tax in 1940, is the federal law on the harmonization of direct taxes of the cantons and municipalities (StHG), Article 7, paragraph 1 as well as the federal law on direct federal tax (DBG) , Article 21, paragraph 1 b.
While the StHG declares the owner-occupied property to be taxable, the DBG and all cantonal tax laws record the rental value of property used by the owner as a taxable income in kind.
The imputed rental value varies considerably from canton to canton. With the taxation of the additional income calculated in this way, a balance should be created between tenants and owner-occupiers. In compensation, Swiss tax law allows owners to deduct mortgage interest and costs for building maintenance (e.g. renovations and conversions) when determining their taxable income.
The determination is largely based on an official market value estimate, which, however, does not reflect the effective market rent.
The taxation of the imputed rental value and the associated deductibility of mortgage interest from taxes is regularly cited as the reason for the high level of debt of Swiss households by international standards (debt ratio 2017 = 130% of GDP).
The procedure is controversial in parts of the population, there have been initiatives to abolish or at least reduce it for years. The homeowners association (HEV), which played a key role in most of the votes , regularly called for the imputed rental value to be abolished while maintaining the deductions for interest and maintenance.
Current development
In 2017 and 2018 there was renewed movement in efforts to abolish it due to the low level of interest rates. The economic commissions of the National Council and Council of States are striving for a “budget-neutral” system change. The concrete proposal for the legislative revision should be ready for consultation in the first quarter of 2019 .
Rejected votes to abolish or reduce
- Federal popular initiative "Home ownership for everyone" of February 7, 1999 (41.3% yes, 58.7% no)
- Vote on the “tax package” of May 16, 2004 (65.9% no)
- Federal popular initiative “Your own four walls thanks to building society savings” from June 17, 2012 (68.9% no)
- Federal popular initiative "Safe living in old age" of 23 September 2012 (52.6% no)
Web links
Individual evidence
- ↑ https://www.admin.ch/opc/de/classified-compilation/19900333/index.html#a7 Federal law on the harmonization of direct taxes of the cantons and municipalities
- ↑ https://www.admin.ch/opc/de/classified-compilation/19900329/index.html#a21 Federal law on direct federal tax
- ↑ The imputed rental value doesn't hurt the same everywhere . NZZ from August 17, 2012, accessed on August 24, 2018.
- ↑ Private households in Switzerland have a record high level of debt . NZZ from October 4, 2017, accessed on August 24, 2018.
- ↑ The imputed rental value is before the launch . NZZ from August 21, 2018, accessed on August 24, 2018.
- ↑ Referendum of February 7, 1999 , Federal Chancellery, accessed on August 24, 2018.
- ↑ Tax package , Federal Department of Finance, accessed on August 24, 2018.
- ↑ Popular initiative “Your own four walls thanks to Bausparen” from June 17, 2012, Federal Department of Finance, accessed on August 24, 2018.
- ↑ "Safe Living in Old Age" initiative of September 23, 2012, Federal Department of Finance, accessed on August 24, 2018.
