Unveiled: Potential overpricing of driving-related services in your Swiss canton examined?
Revamped Spotlight:
Swiss cantons, known as Strassenverkehrsamt (German), Service des automobiles (French), or La Sezione della circolazione (Italian), have diverse responsibilities such as vehicle registration, tax collection, driving tests, licenses, and car inspections. But due to Switzerland's federalist law, each canton possesses the autonomy to self-determine aspects like tax rates, health insurance premiums, and educational systems, even extending to setting their own fees for vehicle-related services.
Comparisons show that some cantons charge substantially more in administrative fees, which cover operating costs, compared to others. According to data from the Federal Finance Administration in 2024, the average administrative fees across the cantons amount to 115 percent, indicating an added 15 percent cost beyond the actual service expenditure.
However, 12 cantons surpass this average, with Ticino and Geneva carrying administrative fees that are 59 and 47 percent above the national average, respectively. Other cantons with high fees include Graubünden (42%), Thurgau (41%), Basel-Country (37%), Appenzell Innerrhoden (35%), Aargau (31%), Bern and Appenzell Ausserrhoden (27%), St. Gallen (23%), Lucerne and Glarus (16%).
On the opposite end, Vaud and Schwyz maintain fees of 13%, while Valais and Fribourg hold fees of just 3%. Interestingly, the canton with the highest living costs, Zurich, along with Zug, only charges 87%, which is 13% below the average. Neuchâtel is even lower at 86%.
While higher or lower administrative costs do not guarantee corresponding high or low service quality, fees in Zurich for a driving test are 250 francs, while in Fribourg they are 190.
Stefan Meierhans, Switzerland's official price monitor, has linked these excessive costs to inefficient management, citing unnecessary steps and suboptimal conduct of services such as inspections as major contributing factors. Since 2022, he has advocated for cantons to cut costs on their automobile services by practicing better service management. However, thus far, these efforts have not yielded results.
No current alternatives exist for individuals to lower these costs, other than relocating to a canton with lower fees, as they are not subject to negotiation or contestation.
In broader regulatory developments, Switzerland has recently introduced VAT rules for digital platforms and is updating VAT group taxation guidance, which may affect vehicle-related transactions. Additionally, the EU plans to implement digital vehicle registration and inspection certificates, which could potentially serve as a model for Switzerland in reducing bureaucratic overhead.
- Some Swiss cantons, such as Ticino and Geneva, have administrative fees for vehicle-related services that are significantly higher than the national average.
- The Swiss cantons are responsible for various aspects including vehicle registration, taxes, inspections, and licenses, but each canton has autonomy to determine aspects like tax rates and fees.
- The Swiss official price monitor, Stefan Meierhans, has linked excessive costs in vehicle-related services to inefficient management, citing unnecessary steps and suboptimal conduct of services.
- Currently, the only way for individuals to lower vehicle-related costs is to relocate to a canton with lower fee structure, as these fees are not subject to negotiation or contestation.
- Regulatory developments in Switzerland and the EU include the introduction of VAT rules for digital platforms, the update of VAT group taxation guidance, and the potential implementation of digital vehicle registration and inspection certificates, which could potentially serve as a model for Switzerland in reducing bureaucratic overhead.
