Income tax (Switzerland)
The income tax in Switzerland is levied from natural persons and recorded the whole income. In principle, all recurring and one-off income is subject to income tax. It is a direct tax levied on the gross principle . The regulations on income tax are an essential part of tax law in Switzerland .
It is collected three times, separately from the federal government, the cantons and communes. The federal government levies it in the form of direct federal tax, the cantons under the term “state tax” in accordance with their respective applicable tax laws. The municipalities levy a “municipal tax” by setting a tax rate in percent that is based on the level of the state tax of the respective canton.
history
Basel-Stadt was the first canton to introduce an income tax in 1840 , seven years after the cantonal separation, which was expensive for Basel . In an international comparison, the first modern income tax is considered to be the first in the United Kingdom from 1798. However, this has since been suspended and only introduced permanently in 1842. Other cantons only followed Basel in 1890 with the canton of Basel-Landschaft and Solothurn in 1895 . During the First World War , the federal government introduced the war tax, a direct tax in 1915, as a wealth tax with a supplementary income tax.
Income tax based on income
There are four categories of income:
- Earned income
- Income income
- Replacement income
- remaining income
Through special laws, components of income can be exempted from income tax or made subject to a special tax.
The tax rate is set independently by the cantons and municipalities , so it can differ significantly in different places. Usually, a progressive tax rate is applied, married couples are usually taxed at a reduced rate (for example through full splitting tariff and social deductions such as the married couple's deduction and two-earner deduction ), but this results in a financial disadvantage compared to unmarried people (see marriage penalty ). The full splitting tariff valid for spouses is also applied to single parents following a corresponding ruling by the Federal Supreme Court in November 2005 , but the tax exemption for single parent families has not been applicable since then.
Cantonal and direct federal taxes are levied. The direct federal taxes are progressive and have a top tax rate of 11.5% from an income of CHF 843,000 for married couples.
Calculation examples
Using the example of the following taxable person, the collection of income tax in Switzerland will be briefly presented. A taxable income of CHF 100,000 and taxable assets of CHF 500,000 served as the basis . The taxpayer is married, reformed and has two children. As a control community were Bottighofen as a tax-effective municipality in the canton Thurgau and Hauptwil-Gottshaus (simplified example) used as one of the most expensive municipality in the canton Thurgau.
| Taxable income | CHF 100,000 |
| Cantonal and municipal taxes | CHF 11'721 |
| Direct federal tax | CHF 2,171 |
Community tax rate: 222%
Total tax rate (including assets): 13.9% on taxable income
| Taxable income | CHF 100,000 |
| Cantonal and municipal taxes | CHF 16,896 |
| Direct federal tax | CHF 2,171 |
Municipal tax rate: 320%
Total tax rate (including assets): 19.1% on taxable income
Taxation based on expenditure (Art. 14 DBG)
Taxation based on expenditure offers the possibility of calculating the tax not based on the income actually earned, but based on a flat-rate estimate of the cost of living in Switzerland. This possibility of taxation is only available to foreign residents of Switzerland who are not gainfully employed in Switzerland. The assessment basis of the tax is based on "seven times the rent or the rental value of the apartment in your own house for taxpayers who run their own household". The minimum assessment basis is CHF 400,000. The flat-rate tax calculated in this way must be at least as high as the tax for normal taxation of Swiss income. Income from abroad is not taken into account.
For these reasons, the taxation based on expenditure is used in particular by wealthy non-Swiss people who live in Switzerland and are subject to tax and who essentially do not earn their income in Switzerland. In a sample calculation from the canton of Aargau, one can see that income that is NOT earned in Switzerland is not relevant for this type of taxation. In Switzerland, around 3,600 people were taxed using this method in 2004 and paid around 290 million Swiss francs in taxes. The average tax amount per person was therefore around CHF 80,000. This information was the subject of parliamentary question 05.1150 by Ms. Leutenegger-Oberholzer on October 7, 2005. In 2009, a popular initiative by a small left party was accepted by the people in the canton of Zurich , calling for this type of tax to be abolished. By 2014, the cantons of Basel-Stadt, Basel-Landschaft, Appenzell Innerrhoden and Schaffhausen had abolished the application of flat-rate taxation. The federal popular initiative “End tax privileges for millionaires (abolition of flat taxation)” with the aim of abolishing flat tax throughout Switzerland was rejected on November 30, 2014.
See also
Web links
- Lexicon: Income tax , in: Vernunft Schweiz .
- Income tax , in: Kantonales Steueramt Kanton Aargau .
- Federal Act of December 14, 1990 on Direct Federal Taxes (DBG)
- Tax calculator of the federal tax administration
Individual evidence
- ↑ http://www.admin.ch/ch/d/sr/c642_11.html Federal law of December 14, 1990 on direct federal taxes
- ↑ René Teuteberg , Basler Geschichte, Basel 1986 (2nd edition 1988)
- ^ Ruedi Brassel-Moser: Income tax. In: Historical Lexicon of Switzerland . April 22, 2015 , accessed July 6, 2019 .
- ↑ Social allowances. (PDF; 95 kB) Graubünden Tax Administration, accessed on December 5, 2009 .
- ↑ Full splitting now also for single parents. (No longer available online.) Canton of St. Gallen, November 23, 2005, archived from the original on May 24, 2010 ; Retrieved December 5, 2009 .
- ↑ Page no longer available , search in web archives: tables on direct federal tax
- ↑ Tax Administration Thurgau - tax calculator
- ↑ Federal Act on Direct Federal Tax Art. 14
- ↑ Information sheet Taxation according to the expenditure from the tax office of the Canton of Aargau, accessed on October 17, 2016
- ↑ Parliamentary question 05.1150 on the scope of taxation based on expenditure by Susanne Leutenegger Oberholzer
- ^ "Good taxpayers follow flat-rate taxpayers" NZZ of October 30, 2014, accessed on October 17, 2016
- ↑ Template No. 587 Swiss Federal Chancellery, accessed on October 17, 2016
