PwC’s international tax comparison 2020 Get an overview of the tax landscape in Switzerland and across the world with PwC www.pwc.ch/international-tax-comparison PwC’s international tax comparison 2020 2 Contents Comparison of taxes for corporations and individuals 4 Comparing taxes: legal entities 5 2020 corporate tax rates in Switzerland 6 2020 corporate tax rates in the EU and Switzerland 7 2020 corporate tax rates in OECD and G20 countries 8 Comparing taxes: natural persons 9 2020 tax burden for natural persons (100’000 CHF net income) 10 2020 tax burden for natural persons (250’000 CHF net income) 12 2020 tax burden for natural persons (marginal tax rate) 14 Your contacts 16 3 PwC’s international tax comparison 2020 Comparison of taxes for corporations and individuals PwC’s tax comparison tool is a quick and easy way to get or see how Hong Kong compares with Germany, the an idea of tax rates for corporations and individuals. international tax comparison tool allows you to examine all the permutations. Tax rates for natural persons vary depending on net income. You can conduct comparisons on three levels: The map of Switzerland featured in this document shows with a taxable net income of 100 000 CHF, a net income tax rates for the capital of each canton. You’ll also find of 250 000 CHF, and the marginal tax rate. And you can this information and a lot more on our interactive map of do all that for the different cantons. Switzerland. Put together your own comparisons at: www.pwc.ch/international-tax-comparison When it comes to corporate entities, we also offer a worldwide comparison. Whether you want to compare Feel free to contact us if you have any questions. tax rates in the canton of Thurgau with those in Chile Armin Marti Stefan Schmid Kornel Wick Partner Partner Director Leader Tax Policy Tax & Legal Services Tax & Legal Services PwC’s international tax comparison 2020 4 Comparing taxes: legal entities Compared to 2019, there have been some significant As a result of the Swiss tax reform, due to the introduction reductions in ordinary cantonal tax rates in many cantons. of new relief measures, from 2020 the effective corporate This is a result on Swiss corporate tax reform, which income tax rate can further be reduced for companies became effective as of 1 January 2020. qualifying for one or more of the newly introduced relief measures, such as the deduction for R&D costs, the The graphic below shows very clearly that the cantons patent box deduction, the deduction on net equity (the of Bern, Zurich and Valais have some of the highest tax latter in the canton of Zurich only) or if they qualify for rates in the country, while tax rates in central Switzerland temporary transition relief due to the abolishment of are significantly lower. former tax regimes. 14.03% Schaffhausen 13.04% Basel-Stadt 13.40% 17.97% Thurgau Basel-Landschaft 13.04% 21.15% Appenzell Ausserrhoden 17.02% 18.61% Zurich Jura 16.21% Aargau Solothurn 12.66% Appenzell Innerrhoden 14.50% 11.91% St Gall 12.32% Zug Lucerne 14.13% 13.57% Schwyz 12.43% Neuchatel 12.66% Glarus Nidwalden 21.63% 12.74% Berne Obwalden 12.64% 14.12% Uri Freiburg 14.77% Grisons 14.00% Vaud 19.16% 14.00% 20.13% Ticino Geneva Valais Low income tax rates High income tax rates 5 PwC’s international tax comparison 2020 2020 corporate tax rates in Switzerland Within the cantons themselves, corporate tax rates vary and Basel-Stadt. For the other cantons, the tax rate may considerably depending on where the entity is located or vary due to municipality-dependent multipliers. The table moving to. There are various cantons with a uniform tax shows the rate for the cantonal capital. rate for all municipalities, including Neuchâtel, St. Gallen 2020 corporate tax rates in Switzerland 1. Zug Uniform tax rate 11.91% 2. Lucerne Uniform tax rate 12.32% 3. Glarus Uniform tax rate 12.43% 4. Uri Uniform tax rate 12.64% 5. Appenzell Innerrhoden Uniform tax rate 12.66% 6. Nidwalden Uniform tax rate 12.66% 7. Obwalden Uniform tax rate 12.74% 8. Appenzell Ausserrhoden Uniform tax rate 13.04% 9. Basel-Stadt Uniform tax rate 13.04% 10. Thurgau Uniform tax rate 13.40% 11. Neuchatel Uniform tax rate 13.57% 12. Vaud Uniform tax rate 14.00% 13. Geneva Uniform tax rate 14.00% 14. Schaffhausen Uniform tax rate 14.03% 15. Fribourg Uniform tax rate 14.12% 16. Schwyz Uniform tax rate 14.13% 17. St Gall Uniform tax rate 14.50% 18. Grisons Uniform tax rate 14.77% 19. Solothurn Uniform tax rate 16.21% 20. Jura Uniform tax rate 17.02% 21. Basel-Landschaft Uniform tax rate 17.97% 22. Aargau Uniform tax rate 18.61% 23. Ticino Uniform tax rate 19.16% 24. Valais Uniform tax rate 20.13% 25. Zurich Uniform tax rate 21.15% 26. Berne Uniform tax rate 21.63% 0% 5% 10% 15% 20% 25% 2020 tax burden in cantonal capital PwC’s international tax comparison 2020 6 2020 corporate tax rates in the EU and Switzerland The Swiss cantons with the lowest rates in Switzerland The most favourable cantons are near the top of the compare well with the lowest tax rates in EU countries. rankings. The chart compares the corporate tax rates With a tax burden twice as high, the most expensive in Zug and Bern with the tax rates of all EU countries. cantons rank in the lower mid-range internationally. 2020 corporate tax rates in the EU and Switzerland 1. Hungary 9.00% 2. Bulgaria 10.00% 3. Switzerland (Zug) 11.91% 4. Cyprus 12.50% 5. Lithuania 15.00% 6. Romania 16.00% 7. Croatia 18.00% 8. Poland 19.00% 9. Slovenia 19.00% 10. Czech Republic 19.00% 11. Estonia 20.00% 12. Finland 20.00% 13. Latvia 20.00% 14. Portugal 21.00% 15. Slowak Republic 21.00% 16. Sweden 21.40% 17. Switzerland (Berne) 21.63% 18. Denmark 22.00% 19. Italy 24.00% 20. Greece 24.00% 21. Luxembourg 24.94% 22. Ireland 25.00% 23. Netherlands 25.00% 24. Austria 25.00% 25. Spain 25.00% 26. Belgium 29.58% 27. France 33.33% 28. Malta* 35.00% 29. Germany 36.00% 0% 5% 10% 15% 20% 25% 30% 35% 40% *Note: special tax refund rules apply 2020 corporate tax rate 7 PwC’s international tax comparison 2020 2020 corporate tax rates in OECD and G20 countries The Swiss cantons with the lowest rates in Switzerland G20 nations. With a tax burden twice as high, the most compare well with the lowest tax rates in the OECD/ expensive cantons rank in the mid-range internationally. 2020 corporate tax rates: OECD and G20 countries 1. Hungary 9.00% 2. Switzerland (Zug) 11.91% 3. Slovenia 19.00% 4. United Kingdom 19.00% 5. Czech Republic 19.00% 6. Poland 19.00% 7. Finland 20.00% 8. Russia 20.00% 9. Saudi Arabia 20.00% 10. Latvia 20.00% 11. Estonia 20.00% 12. Slovak Republic 21.00% 13. Portugal 21.00% 14. Sweden 21.40% 15. Switzerland (Berne) 21.63% 16. Turkey 22.00% 17. Denmark 22.00% 18. Indonesia 22.00% 19. Israel 23.00% 20. Italy 24.00% 21. Greece 24.00% 22. Luxembourg 24.94% 23. Ireland 25.00% 24. Norway 25.00% 25. South Korea 25.00% 26. Netherlands 25.00% 27. China 25.00% 28. Spain 25.00% 29. Austria 25.00% 30. Chile 27.00% 31. South Africa 28.00% 32. New Zealand 28.00% 33. Belgium 29.58% 34. Argentina 30.00% 35. Australia 30.00% 36. Mexico 30.00% 37. Japan 30.62% 38. Canada 31.00% 39. United States of America 33.00% 40. France 33.33% 41. Brazil 34.00% 42. Germany 36.00% 43. India 44.00% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% PwC’s international tax comparison 2020 8 Comparing taxes: natural persons Income tax rates in Switzerland vary considerably from Find out how your canton of residence compares with canton to canton and from municipality to municipality. others. At www.pwc.ch/international-tax-comparison For example, Zug has the lowest rate of any cantonal you can use our interactive map of Switzerland to put capital for a taxable income of 100’000 CHF (10.30%), together detailed comparisons. and Neuchatel, the highest (24.10%). Maximum marginal tax rates for high incomes range from 22.40% in Zug, all On the next few pages we present an overview of the the way up to 45.00% for Geneva. cantons. 9 PwC’s international tax comparison 2020 2020 tax burden for natural persons (100’000 CHF net income) This overview shows tax rates for each cantonal capital. cantonal capital for a net income of 100’000 CHF is the The figures are for a net income of 100’000 CHF. In this municipality of Neuchatel, with a tax rate of almost double scenario Canton Zug (represented by its capital, Zug) that 24.10%. has the lowest tax rate, 10.30%. The most expensive 19.10% Schaffhausen 20.10% Basel-Stadt 17.40% 21.90% Thurgau Basel-Landschaft 18.60% 16.00% Appenzell Ausserrhoden 21.10% 17.20% Zurich Jura 20.00% Aargau Solothurn 13.80% Appenzell Innerrhoden 20.70% 10.30% St Gall 17.10% Zug Lucerne 14.10% 24.10% Schwyz Neuchatel 16.50% 15.00% Glarus Nidwalden 21.10% 13.10% Berne Obwalden 14.50% 21.20% Uri Fribourg 17.30% Grisons 22.80% Vaud 19.30% 22.40% 20.00% Ticino Geneva Valais Low income tax rates High income tax rates PwC’s international tax comparison 2020 10 The chart below shows the rates for the different scenario, for example, the highest tax rate is 25.70% in cantonal capitals.