Clarity on Swiss Taxes

Staying on course when the tide turns ST_Map_170324_v13_Inhalt-2.pdf 1 24.03.2017 11:07:26

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[SMEs] [Regulator & Tax Authorities] 6 Clarity on Swiss Taxes editorial Welcome

an encouraging signal for Switzerland’s future as a business location.

Although the rejection of the Corporate Tax Reform III is a setback, it’s not an unsurmountable one. Some cantons have already introduced immediate measures to safeguard their tax appeal. On a national scale, the Swiss government cannot and will not leave companies and investors stranded in uncertainty. At the same time, the regulatory wave rolls on, with BEPS and Automatic Exchange of Information bringing increased international pressure. A new package to maintain competitiveness Peter Uebelhart without capsizing stability is surely on the horizon. Head of Tax, KPMG Switzerland KPMG’s tax professionals are keenly observing the developments in Switzerland as well as in the EU, OECD Switzerland remains a strong competitor on the global tax and G20. Please contact us for more insights and advice stage, according to data analyzed in KPMG’s “Swiss Tax on any tax matters. Report 2017” . The study compares the corporate and individual income tax rates of 130 countries and all 26 Swiss cantons.

This year’s findings cannot yet reflect the impact of recent turbulence on the Swiss tax landscape but they do send Peter Uebelhart

3 4 5 Swiss Tax Report 2017 Corporate taxation

Corporate income tax

Switzerland remains competitive on the international tax stage, especially in Europe. A cluster of cantons in central and eastern Switzerland retain their status as lower-tax locations. In line with the global trend, Swiss corporate income tax rates have dropped on average over the past decade and continue to creep down. It remains to be seen whether the cantons will honor the cuts they had announced in anticipation of CTR III.

6 Clarity on Swiss Taxes

7 Part I Corporate taxation: corporate income tax Which businesses are shouldering the tax burden?

A small minority of businesses contribute the majority of direct federal taxes, with 2.96% of corporations carrying almost 90% of the tax burden. At the same time, over two thirds of taxpaying corporations pay close to no taxes at all. Around 48.4% of total contributions (CHF 4.3 billion1) stem from privileged companies.

Contribution of businesses to tax revenues from direct federal taxes 87.86% (by profit levels)

67.01%

Taxpayers 13.73% 10.73% 9.59% Contribution to direct federal 2.96% taxes 1.11% 5.59% 1.27% 0.17%

0 - 10 10 - 50 50 - 100 100 - 1000 1000+ Taxable profit in CHF 1,000/year

1 according to the FTA Note: latest available data for the tax period 2013. Source: Federal Tax Administration FTA, 2017 https://www.estv.admin.ch/estv/de/home/allgemein/ steuerstatistiken/fachinformationen/steuerstatistiken/direkte-bundessteuer/dbst-jp-kantone-2013.html

8 Clarity on Swiss Taxes

Corporate income tax rates in the cantons – 2016 and 2017 The cantons of central Switzerland continue to lead the tax league. The majority of cantons did not make any changes to their ordinary tax rates. While Lucerne raised tax rates slightly, Schaffhausen, Grisons and Solothurn reduced their corporate income tax rates. Only Uri reduced its tax rate repeatedly. A further reduction is to be expected among cantons with high taxation in the coming years.

12.32 2016 Lucerne 12.43 2017 12.66 Nidwalden 12.66 Figures in percent 12.66 Obwalden 12.66 13.04 Appenzell A. 13.04 14.16 Appenzell I. 14.16 14.60 Zug 14.60 15.01 Uri 14.92 15.27 Schwyz 15.27 15.61 Neuchâtel 15.61 15.70 Glarus 15.70 16.04 Schaffhausen 15.97 16.68 Grisons 16.12 16.43 Thurgau 16.43 17.40 St. Gallen 17.40 18.61 Aargau 18.61 19.86 Fribourg 19.86 20.66 Jura 20.66 20.67 Ticino 20.67 20.70 Basel-Landschaft 20.70 21.15 Zurich 21.15 21.85 Solothurn 21.49 21.64 Bern 21.64 21.74 Valais 21.74 22.09 Vaud 22.09 22.18 Basel-Stadt 22.18 24.16 Geneva 24.16

Note: max. effective rate on pre-tax profits for federal/cantonal/municipal taxes in the respective cantonal capital. Corporate income tax figures for GE, JU, NE, SG, TG and ZH for 2016. Source: KPMG Switzerland

9 Part I Corporate taxation: corporate income tax

Corporate income tax rates in the cantons – trend in 2007 and 2017 Besides the cantons of central Switzerland, Appenzell A., Glarus, Schaffhausen, Neuchâtel, and in particular Grisons, have also significantly reduced their tax rates for corporations over the past ten years. In the Mittelland region, western Switzerland and the city cantons, changes to ordinary corporate income tax rates have been significantly smaller. Only the canton of Valais has increased its tax rates slightly over the last decade.

18.90 2007 Lucerne - 6.47 12.43 2017 13.12 Obwalden - 0.46 12.66 Figures in percent 17.27 Nidwalden - 4.61 12.66 18.04 Appenzell A. - 5.00 13.04 15.47 Appenzell I. - 1.31 14.16 16.10 Zug - 1.50 14.60 16.32 Uri - 1.40 14.92 19.76 Schwyz - 4.49 15.27 22.18 Neuchâtel - 6.57 15.61 19.98 Glarus - 4.28 15.70 22.84 Schaffhausen - 6.87 15.97 29.06 Grisons - 12.94 16.12 16.98 Thurgau - 0.55 16.43 19.08 St. Gallen - 1.68 17.40 22.32 Aargau - 3.71 18.61 21.95 Fribourg - 2.09 19.86 21.12 Jura - 0.46 20.66 22.00 Ticino - 1.33 20.67 25.65 Basel-Landschaft - 4.95 20.70 21.32 Zurich - 0.17 21.15 22.76 Solothurn - 1.27 21.49 23.40 Bern -1.76 21.64 21.57 Valais 0.17 21.74 23.53 Vaud - 1.44 22.09 24.81 Basel-Stadt - 2.63 22.18 24.24 Geneva - 0.08 24.16

10 Clarity on Swiss Taxes

Corporate income tax rates in the cantons – trend from 2007 to 2017 The corporate income tax rates continue to drop slightly on average.

- 2.99%

20.76% 19.44% 18.96% 18.70% 18.31% 18.06% 18.01% 17.90% 17.89% 17.80% 17.77%

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

30%

Corporate income tax rates in the cantons – trend from 2007 to 2017 Genf After smaller reductions in 2016, corporate tax rates look set to remain stable in 28% 2017. Only Schaffhausen and Grisons saw renewed reductions, while Lucerne Basel-Stadt increased its tax rates. Waadt 26% Bern Zürich 24% Geneva Aargau Basel-Stadt 22% Vaud CH Durchschnitt Bern Zurich St. Gallen

20% Graubünden

Aargau Schaffhausen 18% CH-AverageNeuenburg St. Gallen Schwyz Grisons 16% Schaffhausen NeuchâtelZug Schwyz Zug Nidwalden 14% Obwalden Nid-/Obwalden Lucerne 12% Luzern

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

11 Part I Corporate taxation: corporate income tax

Corporate income tax rates in the cantons in 2017

Cantons with a corporate income tax rate above the Swiss average (17.77%) Cantons with a corporate income tax rate below the Swiss average (17.77%) 22.2 Basel-Stadt Figures in percent

18.6 20.7 Aargau 20.7 Basel-Landschaft Jura 21.5 Solothurn 12.4 Lucerne 15.6 Neuchâtel 12.7 21.6 Obwalden Bern 19.9 22.1 Fribourg Vaud

21.7 Valais 24.2 Geneva

Note: max. effective rate on pre-tax profits for federal/cantonal/municipal taxes in the respective cantonal capital. Corporate income tax figures for GE, NE, SG, TG, ZH for 2016. Source: KPMG Switzerland

12 Clarity on Swiss Taxes

16.0 Schaffhausen

16.4 Thurgau 18.6 Aargau 13.0 21.2 Appenzell A. Zurich 14.2 1 7. 4 Appenzell I. St. Gallen 14.6 12.4 Zug Lucerne 15.3 Schwyz 15.7 12.7 Glarus Nidwalden 14.9 Uri 16.1 Grisons

20.7 Ticino

13 Part I Corporate taxation: corporate income tax Which tax rates had been announced for CTR III? 22.18 13.04

BS 20.70 Announced corporate tax rate reduction 14.00 The majority of cantons had announced their corporate income tax rates as of 21.49 BL 2019 assuming CTR III was approved. Since this was not the case it is questionable whether the cantons will 12.90 stick to the announced rates. SO 15.61 15.61 LU NE 21.64 19.86 22.09 16.37 13.72

13.79 FR BE VD 24.16 13.49* GE

* 13.79% in the first 5 years Note: max. effective rate on pre-tax profits for federal/cantonal/municipal taxes in the respective cantonal capital. Corporate income tax figures for GE, NE, SG, TG, ZH for 2016. Source: KPMG Switzerland.

14 Clarity on Swiss Taxes

Corporate income taxation within the cantons 2017 vs 2019

Figures in percent 15.97 12.50

SH 16.43 13.42 14.00

21.15 TG 18.20

ZH 17.40 15.00 14.60 12.00

12.43 12.43 ZG SG LU 12.66 12.66 NW 20.67 16.20

15 Part I Corporate taxation: corporate income tax

The cantons and European countries compared Overall, the European tax landscape shows quite a few changes that mix up the ranking in 2017. Led by the huge ten-percentage-point drop from Hungary, the upper half also includes a two percentage-point drop from Croatia. Nevertheless, the cantons of central Switzerland are not lacking in attractiveness. Lower income tax rates in the international sphere are applied in particular by the Channel Islands and the countries of Southeast Europe. Ireland remains the most significant competitor for Switzerland.

Guernsey +/– 0 Montenegro 9.00 Hungary 19.00 | 9.00 - 10.00 Bulgaria 10.00 Lucerne 12.32 | 12.43 + 0.11 Ireland 12.50 Liechtenstein 12.50 Jura Cyprus 12.50 Nidwalden 12.66 Obwalden 12.66 Appenzell A. 13.04 Appenzell I. 14.16 Zug 14.60 Uri 15.01 | 14.92 - 0.09 Albania 15.00 Lithuania 15.00 Serbia 15.00 Schwyz 15.27 Neuchâtel 15.61 Glarus 15.70 Schaffhausen 16.04 | 15.97 - 0.07 Romania 16.00 Grisons 16.68 | 16.12 - 0.56 Thurgau 16.43 St. Gallen 17.40 Croatia 20.00 | 18.00 - 2.00 Ukraine 18.00 Aargau 18.61 Poland 19.00

Maximum corporate income tax rates, CH: max. effective rate on pre-tax profits for federal/cantonal/municipal taxes in the respective cantonal capital. Corporate income tax figures for Albania, NE, SG and TG for 2016. Sources: KPMG Switzerland, KPMG International: https://home.kpmg.com/xx/en/home/services/tax/tax-tools-and-resources/tax-rates-online/corporate-tax-rates-table.html

16 Clarity on Swiss Taxes

Countries in the lower half of the ranking also amended tax rates in 2017. While the UK, Slovakia, Norway, Luxembourg and especially Italy reduced tax by between one and seven-point-four percentage points, Slovenia was the only one to increase the rate.

2017 Slovenia 17.00 | 19.00 + 2.00 +/- compared with UK 20.00 | 19.00 - 1.00 previous year

Fribourg 19.86 Figures in percent Estonia 20.00 Turkey 20.00 Jura 20.66 Ticino 20.67 Basel-Landschaft 20.70 Slovakia 22.00 | 21.00 - 1.00 Zurich 21.15 Solothurn 21.85 | 21.49 - 0.36 Bern 21.64 Valais 21.74 Denmark 22.00 Sweden 22.00 Vaud 22.09 Basel-Stadt 22.18 Norway 25.00 | 24.00 - 1.00 Italy 31.40 | 24.00 - 7.40 Geneva 24.16 The Netherlands 25.00 Austria 25.00 Spain 25.00 Luxembourg 29.22 | 27.08 - 2.14 Greece 29.00 Germany 29.72 | 29.79 + 0.07 France 33.33 Malta 35.00

Maximum corporate income tax rates, CH: max. effective rate on pre-tax profits for federal/cantonal/municipal taxes in the respective cantonal capital. Corporate income tax figures for The Netherlands, Spain, GE, JU and ZH for 2016. Sources: KPMG Switzerland, KPMG International: https://home.kpmg.com/xx/en/home/services/tax/tax-tools-and-resources/tax-rates- online/corporate-tax-rates-table.html

17 Part I Corporate taxation: corporate income tax

Global comparison – selected countries Hong Kong and Singapore are considered attractive tax locations, comparable to known offshore domains such as Bermuda or Dubai. Internationally, Switzerland falls within the middle range with its tax rates.

Bahamas 0.00 2017 +/- compared with Bahrain 0.00 previous year

Bermuda 0.00 Figures in percent Cayman Islands 0.00 Dubai 0.00 Qatar 10.00 Hong Kong 16.50 Singapore 1 7. 0 0 Swiss average 17.80 | 17.77 - 0.03 Russia 20.00 Malaysia 24.00 China 25.00 Indonesia 25.00 Panama 25.00 Canada 26.50 South Africa 28.00 Australia 30.00 Japan 30.86 Brazil 34.00 India 34.61 USA 40.00

Maximum corporate income tax rates, CH: max. effective rate on pre-tax profits for federal/cantonal/municipal taxes in the respective cantonal capital. Corporate income tax figures for Russia for 2016. Sources: KPMG Switzerland, KPMG International: https://home.kpmg.com/xx/en/home/services/tax/tax-tools-and-resources/ tax-rates-online/corporate-tax-rates-table.html

Trends: countries 2007 – 2017 Few countries have increased their corporate tax rates in recent years. Hungary, which until now had raised its taxes, cut its corporate tax rates by 7% this year.

28.00 2007 Mexico + 2.00 30.00 2017 18.00 Iceland + 2.00 20.00 Figures in percent 19.00 Slovakia + 2.00 21.00 25.00 Greece + 4.00 29.00 1 7. 0 0 Chile + 8.50 25.50

Maximum corporate income tax rates, CH: max. effective rate on pre-tax profits for federal/cantonal/municipal taxes in the respective cantonal capital. Sources: KPMG Switzerland, KPMG International: https://home.kpmg.com/xx/en/home/services/tax/tax-tools-and-resources/tax-rates-online/corporate-tax-rates-table.html

18 Clarity on Swiss Taxes

Trends: countries 2007 – 2017 The states in the Middle East have made the most impressive cuts in taxation over the past ten years, with the largest drop seen in Kuwait (40%). The UK has announced its intention to cut the corporate income tax rate to 17% by 2020 and Hungary has already enacted a decrease to 9% this year.

55.00 Kuwait - 40.00 15.00 35.00 Gibraltar - 25.00 10.00 35.00 Qatar - 25.00 10.00 37.25 Italy - 13.25 24.00 30.00 UK - 11.00 19.00 40.69 Japan - 9.83 30.86 38.36 Germany - 8.57 29.79 33.00 China - 8.00 25.00 16.00 Hungary - 7.00 9.00 28.00 Sweden - 6.00 22.00 27.50 South Korea - 5.50 22.00 25.00 Jordan - 5.00 20.00 24.00 Russia - 4.00 20.00 27.00 Malaysia - 3.00 24.00 20.00 Singapore - 3.00 1 7. 0 0 20.76 Swiss average - 2.99 17.77 29.63 Luxembourg - 2.55 27.08 17.50 Hong Kong - 1.00 2007 16.50 2017 25.50 The Netherlands - 0.50 25.00 Figures in percent

Maximum corporate income tax rates, CH: max. effective rate on pre-tax profits for federal/cantonal/municipal taxes in the respective cantonal capital. Corporate income tax figures for The Netherlands, Gibraltar and Russia for 2016. Sources: KPMG Switzerland, KPMG International: https://home.kpmg.com/ xx/en/home/services/tax/tax-tools-and-resources/tax-rates-online/corporate-tax-rates-table.html

19 Part II Swiss Tax Report 2017 Individual taxation

Income tax

On a global scale the Swiss cantons are rated among the most attractive in terms of tax rates for high-income individuals. The moderate downward trend of the Swiss average individual tax rates looks to be leveling off in 2017. Nevertheless, the tax burden is still borne by the wealthiest 1% of the Swiss population.

20 Clarity on Swiss Taxes

21 Part II Individual taxation: income tax Who shoulders the tax burden in Switzerland?

Approximately 3.55% of taxpayers – i.e. the highest-income individuals – account for more than 50% of the direct individual tax.

Contribution of individuals to tax revenues from direct federal taxes 52.54%

(by income bracket)

35.39%

26.21%

16.52% 15.64% 14.98%

12.81%

Taxpayers 8.36% 7.09% Contribution to direct federal 4.23% taxes 3.55% 2.68%

Taxable income in 0 - 50 50 - 75 75 - 100 100 - 150 150 - 200 200+ CHF 1,000 / year

Note: latest available data for the tax period 2013. Source: Federal Tax Administration FTA, 2017: https://www.estv.admin.ch/estv/de/home/allgemein/ steuerstatistiken/fachinformationen/steuerstatistiken/direkte-bundessteuer/np_kanton_dbs_2013.html

22 Clarity on Swiss Taxes

78.70

99 - 100

The 10% with the highest income account for almost 80% of the direct individual tax burden. The 1% with the highest income bear 41.3% (prior year 41%) of the tax burden.

Contribution of individuals to tax revenues from direct federal taxes 41.30 (by income bracket)

Figures in percent

98 - 99

11.30

97 - 98

7. 0 0

96 - 97 5.00

95 - 96 3.70 9.69 90 - 95

4.65 10.50 2.81 6.95 1.78 1.05 0.18 0.38 0.67 0.00 Percentage share of taxpayers in direct 0 10 20 30 40 50 60 70 80 90 100 federal taxes

Note: latest available data for the tax period 2013, including persons taxed on a lump-sum basis and taxpayers where income taken into account in determining the tax rate is different from the taxable income. Source: Federal Tax Administration FTA, 2017: https://www.estv.admin.ch/estv/de/home/ allgemein/steuerstatistiken/fachinformationen/steuerstatistiken/direkte-bundessteuer/np_kanton_dbs_2013.html

23 Part II Individual taxation: income tax

Income tax rates in the cantons – 2016 and 2017 The cantons of central Switzerland continue to have the lowest tax rates. Uri, Grisons and Schaffhausen have lowered their individual tax rates. As with the corporate tax rate, Lucerne was the only canton to raise the tax rate for individuals. The highest individual tax rates are seen in cantons that also have the highest corporate tax rates.

22.86 2016 Zug 22.86 2017 24.30 Obwalden 24.30 Figures in percent 25.02 Appenzell I. 25.02 25.49 Uri 25.35

Nidwalden 25.55 25.55 28.21 Schwyz 28.21 30.48 Appenzell A. 30.48 31.56 Glarus 31.56 31.17 Lucerne 31.74 32.40 Grisons 32.18 32.49 Schaffhausen 32.29 32.48 Thurgau 32.48 33.52 St. Gallen 33.52 34.05 Aargau 34.05 34.50 Solothurn 34.18 36.02 Fribourg 36.02 36.50 Valais 36.50 37.43 Basel-Stadt 37.43 39.04 Neuchâtel 39.33 39.76 Zurich 39.76 40.46 Jura 40.46 Ticino 40.72 40.72 41.27 Bern 41.27 41.50 Vaud 41.50 42.17 Basel-Landschaft 42.17 44.75 Geneva 44.75

Note: max. income tax rates for single taxpayers with no children and no religious denomination living in the respective cantonal capital. Income tax rates for AI and SG are for 2016. Source: KPMG Switzerland

24 Clarity on Swiss Taxes

Income tax rates in the cantons – trend from 2007 to 2017 The average individual tax rate appears to be stagnating at a value of 33.99% over the past two years.

- 0.86%

34.85% 34.61% 34.25% 34.05% 33.84% 33.76% 33.77% 33.86% 33.98% 33.99% 33.99%

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

25 Part II Individual taxation: income tax

Income tax rates in the cantons – trend from 2007 to 2017 The central Swiss cantons have been leading the individual tax ranking for over a decade. Apart from Uri, the other cantons have made no or only minor reductions in income tax rates. Obwalden, Schaffhausen and Schwyz are the only cantons to have actually increased their tax rates. Little to no variation can be found in the cantons with traditionally higher individual income taxes.

23.10 2007 Zug 22.86 2017 24.01 Obwalden 24.30 Figures in percent 26.14 Appenzell I. 25.02 33.00 Uri 25.35 26.74 Nidwalden 25.55 25.19 Schwyz 28.21 31.26 Appenzell A. 30.48 34.49 Glarus 31.56 32.55 Lucerne 31.74 32.95 Grisons 32.18 25.20 Schaffhausen 32.29

Thurgau 35.63 32.48 36.16 St. Gallen 33.52 36.84 Aargau 34.05 36.47 Solothurn 34.18 36.33 Fribourg 36.02 37.00 Valais 36.50 38.91 Basel-Stadt 37.43 39.34 Neuchâtel 39.33 40.16 Zurich 39.76 43.54 Jura 40.46

Ticino 41.02 40.72 41.28 Bern 41.27 41.50 Vaud 41.50 42.55 Basel-Landschaft 42.17 44.76 Geneva 44.75

26 Clarity on Swiss Taxes

Income tax rates in the cantons – trend from 2007 to 2017 With the exception of a distinguishable upward trend in the individual income tax rates of Schaffhausen and Schwyz, and a downward trend in Aargau, Thurgau and St. Gallen, the tax rates have remained fairly consistent in the Swiss cantons.

45% Geneva

Vaud Bern 40% Zurich Neuchâtel

Basel-Stadt

35% Aargau Swiss average St. Gallen Thurgau Schaffhausen Lucerne 30%

Schwyz

Nidwalden 25% Obwalden

Zug

20% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

27 Part II Individual taxation: income tax

Individual income tax rates in the cantons in 2017

Cantons with an individual income tax rate above the Swiss average (33.99%) Cantons with an individual income tax rate below the Swiss average (33.99%) 37.4 Basel-Stadt Figures in percent

34.0 42.2 Aargau 40.5 Basel-Landschaft Jura 34.2 Solothurn 31.7 Lucerne 39.3 Neuchâtel 24.3 41.3 Obwalden Bern

36.0 41.5 Fribourg Vaud

36.5 Valais 44.8 Geneva

28 Clarity on Swiss Taxes

32.3 Schaffhausen 32.5 Thurgau 34.0 Aargau 30.5 39.8 Appenzell A. Zurich 25.0 33.5 Appenzell I. St. Gallen 22.9 31.7 Zug Lucerne 28.2 Schwyz 31.6 25.6 Glarus Nidwalden 25.4 Uri 32.2 Grisons

40.7 Ticino

29 Part II Individual taxation: income tax

The cantons and European countries compared The individual income tax rates continue to be particularly low in the countries of Southeast Europe. As with corporate taxation, most of the Swiss cantons lie in the middle in terms of individual income tax rates. Western European and Scandinavian countries levy income tax at relatively high rates. Although already ranking among the countries with the top rates, Luxembourg and Sweden increased their tax rates in 2017. The annual tax adjustments in Finland and Denmark resulted in a reduction this time.

Bulgaria 10.00

Hungary 15.00

Lithuania 15.00

Ukraine 18.00

Jersey 20.00

Estonia 20.00

Czech Republic 22.00

Zug 22.86

Latvia 23.00

Obwalden 24.30

Appenzell I. 25.02

Uri 25.49 | 25.35 - 0.14

Nidwalden 25.55

Schwyz 28.21

Appenzell A. 30.48

Glarus 31.56

Lucerne 31.17 | 31.74 + 0.57

Poland 32.00

Grisons 32.40 | 32.18 - 0.22

Schaffhausen 32.49 | 32.29 - 0.20 Luxembourg

Thurgau 32.48

St. Gallen 33.52

Aargau 34.05 The Netherlands

Solothurn 34.50 | 34.18 - 0.32 Finland

Cyprus 35.00

Turkey 35.00

Fribourg 36.02

Max. income tax rates for single taxpayers with no children and no religious denomination living in the respective cantonal capital. Appenzell I., St. Gallen: income tax rates for 2016. Sources: KPMG Switzerland, KPMG International: https://home.kpmg.com/xx/en/home/services/tax/tax-tools-and-resources/tax-rates-online/ individual-income-tax-rates-table.html

30 Clarity on Swiss Taxes

Valais 36.50 2017 +/- compared with Basel-Stadt 37.43 previous year

Neuchâtel 39.04 | 39.33 + 0.29 Figures in percent

Zurich 39.76

Jura 40.46

Ticino 40.72

Bern 41.27

Vaud 41.50

Basel-Landschaft 42.17

Italy 43.00

Geneva 44.75

Germany 45.00

Spain 45.00

UK 45.00

Greece 45.00

Iceland 46.25 | 46.24 - 0.01

Norway 46.90 | 46.72 - 0.18

Portugal 48.00

Ireland 48.00

Luxembourg 44.00 | 48.78 + 4.78

Slovenia 50.00

Belgium 50.00

The Netherlands 52.00

Finland 54.25 | 54.00 - 0.25

Austria 55.00

Denmark 56.40 | 55.79 - 0.61

Sweden 57.10 | 61.85 + 4.75

Max. income tax rates for single taxpayers with no children and no religious denomination living in the respective cantonal capital. Portugal, Slovenia: income tax rates for 2016. Sources: KPMG Switzerland, KPMG International: https://home.kpmg.com/xx/en/home/services/tax/tax-tools-and-resources/tax-rates-online/individual- income-tax-rates-table.html

31 Part II Individual taxation: income tax

Global comparison (selected countries) While the well-known offshore domains continue to reject the idea of introducing individual income taxes, countries such as Japan or South Africa show very high income taxes in a global comparison.

Bahamas 0.00 2016

2017 Bahrain 0.00 Figures in percent Bermuda 0.00

Cayman Islands 0.00

Oman 0.00

Qatar 0.00

UAE 0.00

13.00 Russia 13.00 15.00 Hong Kong 15.00 20.00 Jordan 20.00 22.00 Singapore 22.00 27.50 Brazil 27.50 28.00 Malaysia 28.00 30.00 Indonesia 30.00 33.00 New Zealand 33.00 33.99 Swiss average 33.99 35.54 India 35.54 39.60 USA 39.60 45.00 China 45.00 45.00 Australia 45.00 41.00 South Africa 45.00 55.95 Japan 55.95

Max. income tax rates for single taxpayers with no children and no religious denomination living in the respective capital. Australia, Bahamas, Bahrain, Hong Kong, Japan, Oman, Qatar, UAE: income tax rates for 2016. Sources: KPMG Switzerland, KPMG International: https://home.kpmg.com/xx/en/home/services/tax/tax-tools-and-resources/tax- rates-online/individual-income-tax-rates-table.html

32 Clarity on Swiss Taxes

Trends: countries 2007 – 2017 The introduction of a flat rate tax affected Eastern European countries most, with a significant decline in the tax rates of Bulgaria, Hungary, Lithuania and the Czech Republic. Especially in Western Europe, income taxes have risen.

36.00 2007 Hungary - 21.00 15.00 2017 24.00 Bulgaria - 14.00 10.00 Figures in percent 27.00 Lithuania - 12.00 15.00 32.00 Czech Republic - 10.00 22.00 40.00 Poland - 8.00 32.00 25.00 Jordan - 5.00 20.00 45.00 Croatia - 5.00 40.00 59.00 Denmark - 3.21 55.79 25.00 Latvia - 2.00 23.00 16.00 Hong Kong -1.00 15.00 34.85 Swiss average - 0.86 33.99 28.00 Malaysia 0.00 28.00 45.00 Germany 0.00 45.00 43.00 Spain + 2.00 45.00 18.00 Isle of Man + 2.00 20.00 35.00 USA + 4.60 39.60 40.00 UK + 5.00 45.00 40.00 Greece + 5.00 45.00 30.00 Cyprus + 5.00 35.00 41.00 Ireland + 7.00 48.00 39.00 Luxembourg + 9.78 48.78 35.70 Iceland + 10.54 46.24

Max. income tax rates for single taxpayers with no children and no religious denomination living in the respective capital. Croatia, Hong Kong: income tax rates for 2016. Sources: KPMG Switzerland, KPMG International: https://home.kpmg.com/xx/en/home/services/tax/tax-tools-and-resources/tax-rates-online/individual-income-tax-rates- table.html

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34 Clarity on Swiss Taxes

CONTACTS & IMPRINT

For further information on Clarity on Swiss Taxes

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Zurich / Ticino Central Switzerland Concept and editing Stefan Kuhn Dr. Frank Lampert Eva Häfliger, KPMGA G Partner Partner +41 58 249 54 14 +41 58 249 49 84 Design [email protected] [email protected] Dany Studerus, KPMG AG

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