09 June 2016 Switzerland adopts federal tax holiday reform effective July 1 Switzerland's Federal Council adopted revised regulations on June 3, on the Swiss federal tax holiday scheme. The purpose of the reform is to improve the attractiveness of specific regional economic development areas and to strengthen the acceptance of the tax incentive program in Switzerland and abroad. The revised legislation provides for relief from federal corporate income tax for a maximum period of 10 years for industrial enterprises and production-related service providers. The federal tax incentives are linked to the number of newly created or maintained jobs by an enterprise domiciled in selected regional areas in Switzerland. It can lead to an annual tax credit of up to CHF 95,000 (approx. US $98,000) for each newly created job and CHF 47,500 (approx. US $49,000) for each maintained job. Depending on the number of newly created or maintained jobs, the cash tax rate may be substantially decreased to a low single-digit tax rate. The revised rules will come into force on July 1. A Tax Alert prepared by EY's Global Tax Desk Network, and attached below, provides additional details. Document ID: 2016-1000 |
