Switzerland to implement minimum tax rate from 2024 under OECD deal

Switzerland will implement from 2024 the minimum tax rate for large multinational companies agreed last year by the OECD and G20 member states, the finance ministry said on Thursday.

Switzerland will implement from 2024 the minimum tax rate for large multinational companies agreed last year by the OECD and G20 member states, the finance ministry said on Thursday. A temporary ordinance will ensure the minimum tax rate of 15% for companies with turnover of more than 750 million euros ($860 million) comes into force on Jan. 1, 2024, the ministry said, adding a law would subsequently be enacted to amend the constitution.

A group of 137 countries in October set the minimum global tax rate of 15% for big companies and sought to make it harder for them to avoid taxation in a landmark deal. "Certain companies will face a heavier tax burden. The minimum rate will spare them additional tax proceedings abroad. Switzerland will have fiscal policy leeway to counteract a possible loss of attractivity as a business location," the ministry said in a statement without giving more details.

Switzerland had been in the international firing line for years because cantons had a special tax status for foreign companies that meant some paid virtually no tax over an effective federal tax of 7.8%. But voters in 2019 approved a shake-up of the corporate tax system, heading off what Finance Minister Ueli Maurer had called an existential threat to the country's role as a business hub.

The vote defused a long-running row over favorable Swiss tax rates for thousands of multinational corporations. A new constitutional amendment would also face a referendum, but the temporary ordinance would let Switzerland adhere to the new global regime in the meantime.

($1 = 0.8721 euros)

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