Swiss Law Revamp: Four Upcoming Regulations with Potential Impact on Taxes and Emergency Alerts
**"Hey there! Here's the lowdown on Switzerland's latest parliamentary decisions.
Let's start with the 12 bills that passed the sniff test during their latest session:
Axe to the rental value tax
This tax corresponds to the potential rental income a property owner might get if they rented their place out. Currently, anyone owning real estate, be it primary or secondary, needs to pay tax on this theoretical amount, as set by tax authorities in each canton.
The plan is to scrap this tax for all properties, but it might not be the case for second homes in tourist cantons, as it could lead to substantial losses of revenue due to reduced property taxes and other local levies.
To make up for the losses, the National Council's Economic Affairs and Fees Committee is suggesting that second homes should be subject to a higher rental value tax. This proposal has the support of the parliamentary majority.
By the way, the cantons have the liberty to independently decide whether to impose a higher tax for secondary residents on their turf.
Digital ID on the horizon
The introduction of an electronic identity that can be loaded onto a smartphone app has stirred up some privacy concerns. Nevertheless, parliament has endorsed it, paving the way for the state digital ID to debut in 2026.
Extension for reporting construction defects
Buyers of new properties will benefit from an extended deadline to report any defects to the construction company, from seven days to 60 days.
Alarm management upgrade
Switzerland's alarm infrastructure consists of around 5,050 remote-controlled fixed sirens that broadcast alerts to the public in emergencies. The state is proposing an increase in maintenance costs for the existing alarm network, from 400 to 600 francs per year and per siren.
Now that you've got the main points, here's where things get juicy:
- The Swiss Federal Council kickstarts the process for new tax laws by drafting a proposal. They consult with experts and stakeholders, then put the draft through a consultation process, where cantons, political parties, and interest groups can weigh in.
- If everything checks out, the draft is approved in Parliament (the National Council and the Council of States). Both chambers must agree to the law.
- If a referendum is demanded with a minimum of 50,000 signatures, the law goes to a national vote, giving the public a final say.
This process is significant when it comes to laws affecting second homeowners, as tourist cantons might see a drop in revenue if taxes on second homes are abolished. Additionally, some cantons have already imposed higher taxes or restrictions on second homes to manage the housing market and ensure affordability for local residents."
Sources:
- Swiss Info – Minimum tax rates for multinationals
- Bilaterals.org – Switzerland-Germany Bilateral Agreement on Direct Taxation
- Parliament of Switzerland – Consultation on the Elimination of the Rental Value Tax
- SWI swissinfo.ch – Switzerland prepares for electronic ID
- Swiss Info – Parliament debates indirect tax proposals
The proposed elimination of the rental value tax in Switzerland, if approved, may impact the finance and business sectors, particularly for second homeowners in tourist cantons, as these changes could lead to losses in revenue due to reduced property taxes and other local levies. This is because cantons might decide to impose a higher tax for secondary residents to make up for the losses, as suggested by the National Council's Economic Affairs and Fees Committee.
The introduction of a digital ID in Switzerland, designed to be loaded onto a smartphone app, has indeed raised concerns about privacy. Despite these concerns, the initiative has garnered parliamentary endorsement, opening the door for the state digital ID to be rolled out in 2026, affecting the general-news and politics spheres.
