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November 29, 2016
2016-2025

Swiss canton of Solothurn releases plan for implementation of Corporate Tax Reform III

Following the recent adoption of the federal tax reform package by the Swiss Parliament, the Swiss cantons are now outlining their corporate tax strategies for local implementation. In June 2016, the Swiss Parliament approved the final bill on the third series of corporate tax reform (CTR III), foreseeing the replacement of certain preferential tax regimes with a new set of internationally accepted measures. The legislative changes will go along with a broad reduction of corporate income tax rates to 11.5%-14% (including federal taxes) in most relevant cantons. The reform aims to ensure that Switzerland remains attractive for multinational corporations while being fully aligned with international taxation standards in a post-base erosion and profit shifting (BEPS) world.

The Government of the canton of Solothurn presented its strategy to implement CTR III into its cantonal tax law on October 31. Inter alia, the plan includes the introduction of a patent box, research and development (R&D) super deduction and a notional interest deduction (NID) on surplus equity. Additionally, the headline corporate income tax rate is to be reduced from 21.8% to 12.9% (including federal tax).

A Tax Alert prepared by Ernst & Young Switzerland, and attached below, provides additional details.

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Full text of Tax Alert 2016-2025

 

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